Henan Kedi Dairy Industry Co Ltd (2770) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Henan Kedi Dairy Industry Co Ltd (China)
Based on various researches at Oak Spring University , Henan Kedi Dairy Industry Co Ltd is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing energy prices, technology disruption, there is backlash against globalization, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies,
competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Henan Kedi Dairy Industry Co Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Henan Kedi Dairy Industry Co Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Henan Kedi Dairy Industry Co Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd can be done for the following purposes –
1. Strategic planning of Henan Kedi Dairy Industry Co Ltd
2. Improving business portfolio management of Henan Kedi Dairy Industry Co Ltd
3. Assessing feasibility of the new initiative in China
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Henan Kedi Dairy Industry Co Ltd
Strengths of Henan Kedi Dairy Industry Co Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Henan Kedi Dairy Industry Co Ltd are -
Diverse revenue streams
– Henan Kedi Dairy Industry Co Ltd is present in almost all the verticals within the Food Processing industry. This has provided Henan Kedi Dairy Industry Co Ltd 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 Food Processing industry
– Henan Kedi Dairy Industry Co Ltd has clearly differentiated products in the market place. This has enabled Henan Kedi Dairy Industry Co Ltd to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped Henan Kedi Dairy Industry Co Ltd to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy of Henan Kedi Dairy Industry Co Ltd comprises – understanding the underlying the factors in the Food Processing 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.
Learning organization
- Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Henan Kedi Dairy Industry Co Ltd emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Henan Kedi Dairy Industry Co Ltd is one of the leading players in the Food Processing 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.
Organizational Resilience of Henan Kedi Dairy Industry Co Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Henan Kedi Dairy Industry Co Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Henan Kedi Dairy Industry Co Ltd 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 Food Processing 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.
Low bargaining power of suppliers
– Suppliers of Henan Kedi Dairy Industry Co Ltd in the Consumer/Non-Cyclical sector have low bargaining power. Henan Kedi Dairy Industry Co Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Henan Kedi Dairy Industry Co Ltd to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Henan Kedi Dairy Industry Co Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Henan Kedi Dairy Industry Co Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Henan Kedi Dairy Industry Co Ltd has one of the best training and development program in Consumer/Non-Cyclical 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.
Highly skilled collaborators
– Henan Kedi Dairy Industry Co Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Food Processing industry. Secondly the value chain collaborators of Henan Kedi Dairy Industry Co Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the Food Processing industry
– Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Henan Kedi Dairy Industry Co Ltd are -
Aligning sales with marketing
– From the outside it seems that Henan Kedi Dairy Industry Co Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Food Processing industry have deep experience in developing customer relationships. Marketing department at Henan Kedi Dairy Industry Co Ltd can leverage the sales team experience to cultivate customer relationships as Henan Kedi Dairy Industry Co Ltd is planning to shift buying processes online.
Lack of clear differentiation of Henan Kedi Dairy Industry Co Ltd products
– To increase the profitability and margins on the products, Henan Kedi Dairy Industry Co Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Henan Kedi Dairy Industry Co Ltd supply chain. Even after few cautionary changes, Henan Kedi Dairy Industry Co Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Henan Kedi Dairy Industry Co Ltd vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of Henan Kedi Dairy Industry Co Ltd strategy
– From the outside it seems that the employees of Henan Kedi Dairy Industry Co Ltd 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.
Workers concerns about automation
– As automation is fast increasing in the Food Processing industry, Henan Kedi Dairy Industry Co Ltd 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.
Capital Spending Reduction
– Even during the low interest decade, Henan Kedi Dairy Industry Co Ltd 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 Food Processing industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Henan Kedi Dairy Industry Co Ltd is dominated by functional specialists. It is not different from other players in the Food Processing industry, but Henan Kedi Dairy Industry Co Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Henan Kedi Dairy Industry Co Ltd to focus more on services in the Food Processing industry rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Henan Kedi Dairy Industry Co Ltd 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Henan Kedi Dairy Industry Co Ltd is slow explore the new channels of communication. These new channels of communication can help Henan Kedi Dairy Industry Co Ltd to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of China, Henan Kedi Dairy Industry Co Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Henan Kedi Dairy Industry Co Ltd 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.
Henan Kedi Dairy Industry Co Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Henan Kedi Dairy Industry Co Ltd are -
Use of Bitcoin and other crypto currencies for transactions in Food Processing industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Henan Kedi Dairy Industry Co Ltd in the Food Processing industry. Now Henan Kedi Dairy Industry Co Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Henan Kedi Dairy Industry Co Ltd can use these opportunities to build new business models that can help the communities that Henan Kedi Dairy Industry Co Ltd operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Using analytics as competitive advantage
– Henan Kedi Dairy Industry Co Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Food Processing sector. This continuous investment in analytics has enabled Henan Kedi Dairy Industry Co Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Henan Kedi Dairy Industry Co Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Henan Kedi Dairy Industry Co Ltd to increase its market reach. Henan Kedi Dairy Industry Co Ltd 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.
Buying journey improvements
– Henan Kedi Dairy Industry Co Ltd can improve the customer journey of consumers in the Food Processing 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 Food Processing industry, but it has also influenced the consumer preferences. Henan Kedi Dairy Industry Co Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Henan Kedi Dairy Industry Co Ltd 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.
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. Henan Kedi Dairy Industry Co Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Henan Kedi Dairy Industry Co Ltd 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.
Building a culture of innovation
– managers at Henan Kedi Dairy Industry Co Ltd 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 Food Processing industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Henan Kedi Dairy Industry Co Ltd can develop new processes and procedures in Food Processing 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Henan Kedi Dairy Industry Co Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Henan Kedi Dairy Industry Co Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Henan Kedi Dairy Industry Co Ltd are -
Consumer confidence and its impact on Henan Kedi Dairy Industry Co Ltd 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 Food Processing industry and other sectors.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd prominent markets.
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.
Environmental challenges
– Henan Kedi Dairy Industry Co Ltd 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. Henan Kedi Dairy Industry Co Ltd can take advantage of this fund but it will also bring new competitors in the Food Processing industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Henan Kedi Dairy Industry Co Ltd in Food Processing industry. The Food Processing 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Food Processing industry are lowering. It can presents Henan Kedi Dairy Industry Co Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Food Processing 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.
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 Henan Kedi Dairy Industry Co Ltd in the Food Processing sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Henan Kedi Dairy Industry Co Ltd may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing 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. Henan Kedi Dairy Industry Co Ltd 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.
Shortening product life cycle
– it is one of the major threat that Henan Kedi Dairy Industry Co Ltd is facing in Food Processing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Henan Kedi Dairy Industry Co Ltd
– 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 Henan Kedi Dairy Industry Co Ltd.
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. Henan Kedi Dairy Industry Co Ltd needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Henan Kedi Dairy Industry Co Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd 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 Henan Kedi Dairy Industry Co Ltd needs to make to build a sustainable competitive advantage.