Jiangsu Jingshen Salt & Chemical (603299) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Jiangsu Jingshen Salt & Chemical (China)
Based on various researches at Oak Spring University , Jiangsu Jingshen Salt & Chemical is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, there is backlash against globalization, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs,
increasing government debt because of Covid-19 spendings, technology disruption, etc
Introduction to SWOT Analysis of Jiangsu Jingshen Salt & Chemical
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jiangsu Jingshen Salt & Chemical can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jiangsu Jingshen Salt & Chemical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical can be done for the following purposes –
1. Strategic planning of Jiangsu Jingshen Salt & Chemical
2. Improving business portfolio management of Jiangsu Jingshen Salt & Chemical
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 Jiangsu Jingshen Salt & Chemical
Strengths of Jiangsu Jingshen Salt & Chemical | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jiangsu Jingshen Salt & Chemical are -
Training and development
– Jiangsu Jingshen Salt & Chemical 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.
Superior customer experience
– The customer experience strategy of Jiangsu Jingshen Salt & Chemical in Food Processing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of Jiangsu Jingshen Salt & Chemical 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.
Ability to recruit top talent
– Jiangsu Jingshen Salt & Chemical 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.
Innovation driven organization
– Jiangsu Jingshen Salt & Chemical is one of the most innovative firm in Food Processing sector.
Digital Transformation in Food Processing industry
- digital transformation varies from industry to industry. For Jiangsu Jingshen Salt & Chemical digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jiangsu Jingshen Salt & Chemical 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.
Ability to lead change in Food Processing
– Jiangsu Jingshen Salt & Chemical is one of the leading players in the Food Processing industry in China. Over the years it has not only transformed the business landscape in the Food Processing industry in China but also across the existing markets. The ability to lead change has enabled Jiangsu Jingshen Salt & Chemical in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Food Processing industry
– Jiangsu Jingshen Salt & Chemical has clearly differentiated products in the market place. This has enabled Jiangsu Jingshen Salt & Chemical to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped Jiangsu Jingshen Salt & Chemical to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Jiangsu Jingshen Salt & Chemical 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
– Jiangsu Jingshen Salt & Chemical 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.
Learning organization
- Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Jiangsu Jingshen Salt & Chemical emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Jiangsu Jingshen Salt & Chemical | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jiangsu Jingshen Salt & Chemical are -
High dependence on Jiangsu Jingshen Salt & Chemical ‘s star products
– The top 2 products and services of Jiangsu Jingshen Salt & Chemical still accounts for major business revenue. This dependence on star products in Food Processing industry has resulted into insufficient focus on developing new products, even though Jiangsu Jingshen Salt & Chemical has relatively successful track record of launching new products.
Products dominated business model
– Even though Jiangsu Jingshen Salt & Chemical has some of the most successful models in the Food Processing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Jiangsu Jingshen Salt & Chemical should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, Jiangsu Jingshen Salt & Chemical has high operating costs in the Food Processing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Jiangsu Jingshen Salt & Chemical lucrative customers.
Interest costs
– Compare to the competition, Jiangsu Jingshen Salt & Chemical 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.
Aligning sales with marketing
– From the outside it seems that Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical can leverage the sales team experience to cultivate customer relationships as Jiangsu Jingshen Salt & Chemical is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Jiangsu Jingshen Salt & Chemical has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Food Processing industry over the last five years. Jiangsu Jingshen Salt & Chemical 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.
Increasing silos among functional specialists
– The organizational structure of Jiangsu Jingshen Salt & Chemical is dominated by functional specialists. It is not different from other players in the Food Processing industry, but Jiangsu Jingshen Salt & Chemical needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Jiangsu Jingshen Salt & Chemical to focus more on services in the Food Processing industry rather than just following the product oriented approach.
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 Jiangsu Jingshen Salt & Chemical supply chain. Even after few cautionary changes, Jiangsu Jingshen Salt & Chemical is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jiangsu Jingshen Salt & Chemical vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of Jiangsu Jingshen Salt & Chemical is just above the Food Processing 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Jiangsu Jingshen Salt & Chemical is slow explore the new channels of communication. These new channels of communication can help Jiangsu Jingshen Salt & Chemical to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Jiangsu Jingshen Salt & Chemical has a high cash cycle compare to other players in the Food Processing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Jiangsu Jingshen Salt & Chemical Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jiangsu Jingshen Salt & Chemical are -
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 Jiangsu Jingshen Salt & Chemical 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jiangsu Jingshen Salt & Chemical in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.
Buying journey improvements
– Jiangsu Jingshen Salt & Chemical 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jiangsu Jingshen Salt & Chemical is facing challenges because of the dominance of functional experts in the organization. Jiangsu Jingshen Salt & Chemical can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Jiangsu Jingshen Salt & Chemical 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.
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. Jiangsu Jingshen Salt & Chemical can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Jiangsu Jingshen Salt & Chemical 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.
Loyalty marketing
– Jiangsu Jingshen Salt & Chemical 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.
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 Jiangsu Jingshen Salt & Chemical in the Food Processing industry. Now Jiangsu Jingshen Salt & Chemical can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Jiangsu Jingshen Salt & Chemical can use the latest technology developments to improve its manufacturing and designing process in Food Processing 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jiangsu Jingshen Salt & Chemical can use these opportunities to build new business models that can help the communities that Jiangsu Jingshen Salt & Chemical operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jiangsu Jingshen Salt & Chemical can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jiangsu Jingshen Salt & Chemical are -
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. Jiangsu Jingshen Salt & Chemical needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Jiangsu Jingshen Salt & Chemical 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 Food Processing industry.
Shortening product life cycle
– it is one of the major threat that Jiangsu Jingshen Salt & Chemical is facing in Food Processing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Food Processing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Jiangsu Jingshen Salt & Chemical can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Jiangsu Jingshen Salt & Chemical 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.
Increasing wage structure of Jiangsu Jingshen Salt & Chemical
– 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 Jiangsu Jingshen Salt & Chemical.
Technology acceleration in Forth Industrial Revolution
– Jiangsu Jingshen Salt & Chemical has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, Jiangsu Jingshen Salt & Chemical needs to keep up with the evolution of technology in the Food Processing 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.
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. Jiangsu Jingshen Salt & Chemical 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.
Consumer confidence and its impact on Jiangsu Jingshen Salt & Chemical 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.
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 Jiangsu Jingshen Salt & Chemical 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, Jiangsu Jingshen Salt & Chemical 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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical prominent markets.
Weighted SWOT Analysis of Jiangsu Jingshen Salt & Chemical Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical 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 Jiangsu Jingshen Salt & Chemical needs to make to build a sustainable competitive advantage.