SWOT Analysis / TOWS Matrix for Hebei Huijin Electromechanical (China)
Based on various researches at Oak Spring University , Hebei Huijin Electromechanical is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, geopolitical disruptions, increasing commodity prices, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization,
increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Hebei Huijin Electromechanical
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hebei Huijin Electromechanical can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hebei Huijin Electromechanical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical can be done for the following purposes –
1. Strategic planning of Hebei Huijin Electromechanical
2. Improving business portfolio management of Hebei Huijin Electromechanical
3. Assessing feasibility of the new initiative in China
4. Making a Office Equipment sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hebei Huijin Electromechanical
Strengths of Hebei Huijin Electromechanical | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hebei Huijin Electromechanical are -
Cross disciplinary teams
– Horizontal connected teams at the Hebei Huijin Electromechanical 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.
Diverse revenue streams
– Hebei Huijin Electromechanical is present in almost all the verticals within the Office Equipment industry. This has provided Hebei Huijin Electromechanical 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.
Superior customer experience
– The customer experience strategy of Hebei Huijin Electromechanical in Office Equipment industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Office Equipment industry
- digital transformation varies from industry to industry. For Hebei Huijin Electromechanical digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hebei Huijin Electromechanical 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.
Sustainable margins compare to other players in Office Equipment industry
– Hebei Huijin Electromechanical has clearly differentiated products in the market place. This has enabled Hebei Huijin Electromechanical to fetch slight price premium compare to the competitors in the Office Equipment industry. The sustainable margins have also helped Hebei Huijin Electromechanical to invest into research and development (R&D) and innovation.
Ability to lead change in Office Equipment
– Hebei Huijin Electromechanical is one of the leading players in the Office Equipment industry in China. Over the years it has not only transformed the business landscape in the Office Equipment industry in China but also across the existing markets. The ability to lead change has enabled Hebei Huijin Electromechanical in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Hebei Huijin Electromechanical is one of the leading players in the Office Equipment 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.
High switching costs
– The high switching costs that Hebei Huijin Electromechanical 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.
Analytics focus
– Hebei Huijin Electromechanical 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 Office Equipment 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.
Highly skilled collaborators
– Hebei Huijin Electromechanical has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Office Equipment industry. Secondly the value chain collaborators of Hebei Huijin Electromechanical have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy of Hebei Huijin Electromechanical comprises – understanding the underlying the factors in the Office Equipment 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.
Low bargaining power of suppliers
– Suppliers of Hebei Huijin Electromechanical in the Technology sector have low bargaining power. Hebei Huijin Electromechanical has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hebei Huijin Electromechanical to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Hebei Huijin Electromechanical | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hebei Huijin Electromechanical are -
Skills based hiring in Office Equipment industry
– The stress on hiring functional specialists at Hebei Huijin Electromechanical has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Products dominated business model
– Even though Hebei Huijin Electromechanical has some of the most successful models in the Office Equipment industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hebei Huijin Electromechanical should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Hebei Huijin Electromechanical has a high cash cycle compare to other players in the Office Equipment 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
– Hebei Huijin Electromechanical 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.
Low market penetration in new markets
– Outside its home market of China, Hebei Huijin Electromechanical needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Hebei Huijin Electromechanical is one of the leading players in the Office Equipment industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Office Equipment industry in last five years.
High dependence on Hebei Huijin Electromechanical ‘s star products
– The top 2 products and services of Hebei Huijin Electromechanical still accounts for major business revenue. This dependence on star products in Office Equipment industry has resulted into insufficient focus on developing new products, even though Hebei Huijin Electromechanical has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Hebei Huijin Electromechanical 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 Office Equipment industry using digital technology.
Workers concerns about automation
– As automation is fast increasing in the Office Equipment industry, Hebei Huijin Electromechanical 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 bargaining power of channel partners in Office Equipment industry
– because of the regulatory requirements in China, Hebei Huijin Electromechanical 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 Office Equipment industry.
Aligning sales with marketing
– From the outside it seems that Hebei Huijin Electromechanical needs to have more collaboration between its sales team and marketing team. Sales professionals in the Office Equipment industry have deep experience in developing customer relationships. Marketing department at Hebei Huijin Electromechanical can leverage the sales team experience to cultivate customer relationships as Hebei Huijin Electromechanical is planning to shift buying processes online.
Hebei Huijin Electromechanical Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hebei Huijin Electromechanical are -
Developing new processes and practices
– Hebei Huijin Electromechanical can develop new processes and procedures in Office Equipment 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.
Buying journey improvements
– Hebei Huijin Electromechanical can improve the customer journey of consumers in the Office Equipment 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hebei Huijin Electromechanical can use these opportunities to build new business models that can help the communities that Hebei Huijin Electromechanical operates in. Secondly it can use opportunities from government spending in Office Equipment sector.
Building a culture of innovation
– managers at Hebei Huijin Electromechanical 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 Office Equipment industry.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hebei Huijin Electromechanical can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Hebei Huijin Electromechanical has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Office Equipment sector. This continuous investment in analytics has enabled Hebei Huijin Electromechanical to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hebei Huijin Electromechanical to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Hebei Huijin Electromechanical 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hebei Huijin Electromechanical in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Office Equipment industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Hebei Huijin Electromechanical has opened avenues for new revenue streams for the organization in Office Equipment industry. This can help Hebei Huijin Electromechanical to build a more holistic ecosystem for Hebei Huijin Electromechanical products in the Office Equipment industry by providing – data insight services, data privacy related products, data based consulting services, 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. Hebei Huijin Electromechanical can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Hebei Huijin Electromechanical to increase its market reach. Hebei Huijin Electromechanical 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hebei Huijin Electromechanical can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Threats Hebei Huijin Electromechanical External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hebei Huijin Electromechanical are -
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 Hebei Huijin Electromechanical business can come under increasing regulations regarding data privacy, data security, etc.
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. Hebei Huijin Electromechanical 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical prominent markets.
Technology acceleration in Forth Industrial Revolution
– Hebei Huijin Electromechanical has witnessed rapid integration of technology during Covid-19 in the Office Equipment industry. As one of the leading players in the industry, Hebei Huijin Electromechanical needs to keep up with the evolution of technology in the Office Equipment 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.
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 Hebei Huijin Electromechanical.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hebei Huijin Electromechanical in Office Equipment industry. The Office Equipment 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.
Consumer confidence and its impact on Hebei Huijin Electromechanical 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 Office Equipment industry and other sectors.
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 Hebei Huijin Electromechanical in the Office Equipment sector and impact the bottomline of the organization.
Regulatory challenges
– Hebei Huijin Electromechanical 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 Office Equipment industry regulations.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Office Equipment industry are lowering. It can presents Hebei Huijin Electromechanical with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Office Equipment sector.
Easy access to finance
– Easy access to finance in Office Equipment industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hebei Huijin Electromechanical can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Hebei Huijin Electromechanical 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. Hebei Huijin Electromechanical can take advantage of this fund but it will also bring new competitors in the Office Equipment industry.
Weighted SWOT Analysis of Hebei Huijin Electromechanical Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical 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 Hebei Huijin Electromechanical needs to make to build a sustainable competitive advantage.
