SWOT Analysis / TOWS Matrix for LeKing Wellness (China)
Based on various researches at Oak Spring University , LeKing Wellness is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google,
competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that LeKing Wellness can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the LeKing Wellness, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which LeKing Wellness 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 LeKing Wellness can be done for the following purposes –
1. Strategic planning of LeKing Wellness
2. Improving business portfolio management of LeKing Wellness
3. Assessing feasibility of the new initiative in China
4. Making a Appliance & Tool sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of LeKing Wellness
Strengths of LeKing Wellness | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of LeKing Wellness are -
High switching costs
– The high switching costs that LeKing Wellness 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.
Innovation driven organization
– LeKing Wellness is one of the most innovative firm in Appliance & Tool sector.
High brand equity
– LeKing Wellness has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled LeKing Wellness to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– LeKing Wellness has one of the best training and development program in Consumer 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.
Analytics focus
– LeKing Wellness 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 Appliance & Tool 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.
Successful track record of launching new products
– LeKing Wellness has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. LeKing Wellness has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Digital Transformation in Appliance & Tool industry
- digital transformation varies from industry to industry. For LeKing Wellness digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. LeKing Wellness 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 Appliance & Tool industry
– LeKing Wellness has clearly differentiated products in the market place. This has enabled LeKing Wellness to fetch slight price premium compare to the competitors in the Appliance & Tool industry. The sustainable margins have also helped LeKing Wellness to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of LeKing Wellness in Appliance & Tool industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– LeKing Wellness is one of the leading players in the Appliance & Tool 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.
Strong track record of project management in the Appliance & Tool industry
– LeKing Wellness is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the LeKing Wellness 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.
Weaknesses of LeKing Wellness | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of LeKing Wellness are -
Lack of clear differentiation of LeKing Wellness products
– To increase the profitability and margins on the products, LeKing Wellness needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, LeKing Wellness has high operating costs in the Appliance & Tool industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract LeKing Wellness lucrative customers.
Employees’ less understanding of LeKing Wellness strategy
– From the outside it seems that the employees of LeKing Wellness 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.
No frontier risks strategy
– From the 10K / annual statement of LeKing Wellness, it seems that company is thinking out the frontier risks that can impact Appliance & Tool industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Aligning sales with marketing
– From the outside it seems that LeKing Wellness needs to have more collaboration between its sales team and marketing team. Sales professionals in the Appliance & Tool industry have deep experience in developing customer relationships. Marketing department at LeKing Wellness can leverage the sales team experience to cultivate customer relationships as LeKing Wellness is planning to shift buying processes online.
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 LeKing Wellness supply chain. Even after few cautionary changes, LeKing Wellness is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left LeKing Wellness vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though LeKing Wellness has some of the most successful models in the Appliance & Tool industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. LeKing Wellness should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, LeKing Wellness has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Appliance & Tool industry over the last five years. LeKing Wellness 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.
High bargaining power of channel partners in Appliance & Tool industry
– because of the regulatory requirements in China, LeKing Wellness 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 Appliance & Tool industry.
Slow to strategic competitive environment developments
– As LeKing Wellness is one of the leading players in the Appliance & Tool industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Appliance & Tool industry in last five years.
Increasing silos among functional specialists
– The organizational structure of LeKing Wellness is dominated by functional specialists. It is not different from other players in the Appliance & Tool industry, but LeKing Wellness needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help LeKing Wellness to focus more on services in the Appliance & Tool industry rather than just following the product oriented approach.
LeKing Wellness Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of LeKing Wellness are -
Better consumer reach
– The expansion of the 5G network will help LeKing Wellness to increase its market reach. LeKing Wellness 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for LeKing Wellness in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Appliance & Tool industry, and it will provide faster access to the consumers.
Manufacturing automation
– LeKing Wellness can use the latest technology developments to improve its manufacturing and designing process in Appliance & Tool 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Appliance & Tool industry, but it has also influenced the consumer preferences. LeKing Wellness can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions in Appliance & Tool industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for LeKing Wellness in the Appliance & Tool industry. Now LeKing Wellness can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Appliance & Tool industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. LeKing Wellness can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. LeKing Wellness can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Buying journey improvements
– LeKing Wellness can improve the customer journey of consumers in the Appliance & Tool 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, LeKing Wellness is facing challenges because of the dominance of functional experts in the organization. LeKing Wellness can utilize new technology in the field of Appliance & Tool industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of LeKing Wellness has opened avenues for new revenue streams for the organization in Appliance & Tool industry. This can help LeKing Wellness to build a more holistic ecosystem for LeKing Wellness products in the Appliance & Tool industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, LeKing Wellness 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 LeKing Wellness to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– LeKing Wellness 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects LeKing Wellness can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, LeKing Wellness can use these opportunities to build new business models that can help the communities that LeKing Wellness operates in. Secondly it can use opportunities from government spending in Appliance & Tool sector.
Threats LeKing Wellness External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of LeKing Wellness are -
Increasing wage structure of LeKing Wellness
– 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 LeKing Wellness.
Technology acceleration in Forth Industrial Revolution
– LeKing Wellness has witnessed rapid integration of technology during Covid-19 in the Appliance & Tool industry. As one of the leading players in the industry, LeKing Wellness needs to keep up with the evolution of technology in the Appliance & Tool 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.
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 LeKing Wellness in the Appliance & Tool sector and impact the bottomline of the organization.
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. LeKing Wellness 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.
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 LeKing Wellness.
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 LeKing Wellness business can come under increasing regulations regarding data privacy, data security, etc.
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. LeKing Wellness needs to understand the core reasons impacting the Appliance & Tool industry. This will help it in building a better workplace.
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 Appliance & Tool industry are lowering. It can presents LeKing Wellness with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Appliance & Tool sector.
Consumer confidence and its impact on LeKing Wellness 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 Appliance & Tool industry and other sectors.
Stagnating economy with rate increase
– LeKing Wellness 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 Appliance & Tool industry.
Environmental challenges
– LeKing Wellness 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. LeKing Wellness can take advantage of this fund but it will also bring new competitors in the Appliance & Tool industry.
Shortening product life cycle
– it is one of the major threat that LeKing Wellness is facing in Appliance & Tool sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of LeKing Wellness Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at LeKing Wellness 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 LeKing Wellness 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 LeKing Wellness 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 LeKing Wellness 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 LeKing Wellness needs to make to build a sustainable competitive advantage.