Tianjin Hi-Tech Dev (600082) SWOT Analysis / TOWS Matrix / MBA Resources
Retail (Department & Discount)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Tianjin Hi-Tech Dev (China)
Based on various researches at Oak Spring University , Tianjin Hi-Tech Dev is operating in a macro-environment that has been destablized by – wage bills are increasing, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, increasing commodity prices, supply chains are disrupted by pandemic , technology disruption, there is increasing trade war between United States & China,
geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Tianjin Hi-Tech Dev
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tianjin Hi-Tech Dev can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tianjin Hi-Tech Dev, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev can be done for the following purposes –
1. Strategic planning of Tianjin Hi-Tech Dev
2. Improving business portfolio management of Tianjin Hi-Tech Dev
3. Assessing feasibility of the new initiative in China
4. Making a Retail (Department & Discount) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tianjin Hi-Tech Dev
Strengths of Tianjin Hi-Tech Dev | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tianjin Hi-Tech Dev are -
Highly skilled collaborators
– Tianjin Hi-Tech Dev has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Retail (Department & Discount) industry. Secondly the value chain collaborators of Tianjin Hi-Tech Dev have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Tianjin Hi-Tech Dev is one of the most innovative firm in Retail (Department & Discount) sector.
Sustainable margins compare to other players in Retail (Department & Discount) industry
– Tianjin Hi-Tech Dev has clearly differentiated products in the market place. This has enabled Tianjin Hi-Tech Dev to fetch slight price premium compare to the competitors in the Retail (Department & Discount) industry. The sustainable margins have also helped Tianjin Hi-Tech Dev to invest into research and development (R&D) and innovation.
Organizational Resilience of Tianjin Hi-Tech Dev
– The covid-19 pandemic has put organizational resilience at the centre of everthing Tianjin Hi-Tech Dev does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Tianjin Hi-Tech Dev has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tianjin Hi-Tech Dev to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Retail (Department & Discount) industry
- digital transformation varies from industry to industry. For Tianjin Hi-Tech Dev digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tianjin Hi-Tech Dev 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.
High switching costs
– The high switching costs that Tianjin Hi-Tech Dev 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.
Low bargaining power of suppliers
– Suppliers of Tianjin Hi-Tech Dev in the Services sector have low bargaining power. Tianjin Hi-Tech Dev has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tianjin Hi-Tech Dev to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Tianjin Hi-Tech Dev has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Tianjin Hi-Tech Dev staying ahead in the Retail (Department & Discount) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Tianjin Hi-Tech Dev has one of the best training and development program in Services 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.
Learning organization
- Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tianjin Hi-Tech Dev emphasize – knowledge, initiative, and innovation.
Ability to lead change in Retail (Department & Discount)
– Tianjin Hi-Tech Dev is one of the leading players in the Retail (Department & Discount) industry in China. Over the years it has not only transformed the business landscape in the Retail (Department & Discount) industry in China but also across the existing markets. The ability to lead change has enabled Tianjin Hi-Tech Dev in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Tianjin Hi-Tech Dev | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Tianjin Hi-Tech Dev are -
Products dominated business model
– Even though Tianjin Hi-Tech Dev has some of the most successful models in the Retail (Department & Discount) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Tianjin Hi-Tech Dev should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners in Retail (Department & Discount) industry
– because of the regulatory requirements in China, Tianjin Hi-Tech Dev 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 Retail (Department & Discount) industry.
Slow to strategic competitive environment developments
– As Tianjin Hi-Tech Dev is one of the leading players in the Retail (Department & Discount) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Retail (Department & Discount) industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Tianjin Hi-Tech Dev is dominated by functional specialists. It is not different from other players in the Retail (Department & Discount) industry, but Tianjin Hi-Tech Dev needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tianjin Hi-Tech Dev to focus more on services in the Retail (Department & Discount) industry rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Tianjin Hi-Tech Dev 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.
Lack of clear differentiation of Tianjin Hi-Tech Dev products
– To increase the profitability and margins on the products, Tianjin Hi-Tech Dev needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Tianjin Hi-Tech Dev has a high cash cycle compare to other players in the Retail (Department & Discount) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Skills based hiring in Retail (Department & Discount) industry
– The stress on hiring functional specialists at Tianjin Hi-Tech Dev 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.
High operating costs
– Compare to the competitors, Tianjin Hi-Tech Dev has high operating costs in the Retail (Department & Discount) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Tianjin Hi-Tech Dev lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Tianjin Hi-Tech Dev 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 Retail (Department & Discount) industry using digital technology.
High dependence on Tianjin Hi-Tech Dev ‘s star products
– The top 2 products and services of Tianjin Hi-Tech Dev still accounts for major business revenue. This dependence on star products in Retail (Department & Discount) industry has resulted into insufficient focus on developing new products, even though Tianjin Hi-Tech Dev has relatively successful track record of launching new products.
Tianjin Hi-Tech Dev Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Tianjin Hi-Tech Dev are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tianjin Hi-Tech Dev can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Tianjin Hi-Tech Dev 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.
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 Tianjin Hi-Tech Dev 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.
Creating value in data economy
– The success of analytics program of Tianjin Hi-Tech Dev has opened avenues for new revenue streams for the organization in Retail (Department & Discount) industry. This can help Tianjin Hi-Tech Dev to build a more holistic ecosystem for Tianjin Hi-Tech Dev products in the Retail (Department & Discount) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Tianjin Hi-Tech Dev 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Department & Discount) industry, but it has also influenced the consumer preferences. Tianjin Hi-Tech Dev can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Tianjin Hi-Tech Dev can develop new processes and procedures in Retail (Department & Discount) 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tianjin Hi-Tech Dev to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Tianjin Hi-Tech Dev to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions in Retail (Department & Discount) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Tianjin Hi-Tech Dev in the Retail (Department & Discount) industry. Now Tianjin Hi-Tech Dev 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 Retail (Department & Discount) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Tianjin Hi-Tech Dev 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. Tianjin Hi-Tech Dev 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tianjin Hi-Tech Dev in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Retail (Department & Discount) industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Tianjin Hi-Tech Dev has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Retail (Department & Discount) sector. This continuous investment in analytics has enabled Tianjin Hi-Tech Dev to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev to increase its market reach. Tianjin Hi-Tech Dev 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.
Threats Tianjin Hi-Tech Dev External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev business can come under increasing regulations regarding data privacy, data security, etc.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev prominent markets.
High dependence on third party suppliers
– Tianjin Hi-Tech Dev 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.
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. Tianjin Hi-Tech Dev needs to understand the core reasons impacting the Retail (Department & Discount) industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Retail (Department & Discount) industry are lowering. It can presents Tianjin Hi-Tech Dev with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Retail (Department & Discount) sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Tianjin Hi-Tech Dev may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Retail (Department & Discount) 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. Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev.
Increasing wage structure of Tianjin Hi-Tech Dev
– 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 Tianjin Hi-Tech Dev.
Stagnating economy with rate increase
– Tianjin Hi-Tech Dev 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 Retail (Department & Discount) industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Tianjin Hi-Tech Dev in Retail (Department & Discount) industry. The Retail (Department & Discount) 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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of Tianjin Hi-Tech Dev Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev 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 Tianjin Hi-Tech Dev needs to make to build a sustainable competitive advantage.