SWOT Analysis / TOWS Matrix for Shenyang Jinshan (China)
Based on various researches at Oak Spring University , Shenyang Jinshan is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, increasing energy prices, challanges to central banks by blockchain based private currencies,
there is backlash against globalization, there is increasing trade war between United States & China, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shenyang Jinshan can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shenyang Jinshan, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shenyang Jinshan 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 Shenyang Jinshan can be done for the following purposes –
1. Strategic planning of Shenyang Jinshan
2. Improving business portfolio management of Shenyang Jinshan
3. Assessing feasibility of the new initiative in China
4. Making a Electric Utilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shenyang Jinshan
Strengths of Shenyang Jinshan | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shenyang Jinshan are -
Effective Research and Development (R&D)
– Shenyang Jinshan has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Shenyang Jinshan staying ahead in the Electric Utilities industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Shenyang Jinshan is one of the most innovative firm in Electric Utilities sector.
Learning organization
- Shenyang Jinshan 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 Shenyang Jinshan is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Shenyang Jinshan emphasize – knowledge, initiative, and innovation.
Training and development
– Shenyang Jinshan has one of the best training and development program in Utilities 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.
Successful track record of launching new products
– Shenyang Jinshan has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Shenyang Jinshan 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.
High switching costs
– The high switching costs that Shenyang Jinshan 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.
Diverse revenue streams
– Shenyang Jinshan is present in almost all the verticals within the Electric Utilities industry. This has provided Shenyang Jinshan 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 Shenyang Jinshan in Electric Utilities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Shenyang Jinshan 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 Electric Utilities 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.
Sustainable margins compare to other players in Electric Utilities industry
– Shenyang Jinshan has clearly differentiated products in the market place. This has enabled Shenyang Jinshan to fetch slight price premium compare to the competitors in the Electric Utilities industry. The sustainable margins have also helped Shenyang Jinshan to invest into research and development (R&D) and innovation.
Digital Transformation in Electric Utilities industry
- digital transformation varies from industry to industry. For Shenyang Jinshan digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shenyang Jinshan 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.
Low bargaining power of suppliers
– Suppliers of Shenyang Jinshan in the Utilities sector have low bargaining power. Shenyang Jinshan has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shenyang Jinshan to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Shenyang Jinshan | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shenyang Jinshan are -
Slow to strategic competitive environment developments
– As Shenyang Jinshan is one of the leading players in the Electric Utilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Electric Utilities industry in last five years.
Employees’ less understanding of Shenyang Jinshan strategy
– From the outside it seems that the employees of Shenyang Jinshan 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.
High operating costs
– Compare to the competitors, Shenyang Jinshan has high operating costs in the Electric Utilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Shenyang Jinshan lucrative customers.
Lack of clear differentiation of Shenyang Jinshan products
– To increase the profitability and margins on the products, Shenyang Jinshan needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Shenyang Jinshan has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shenyang Jinshan is slow explore the new channels of communication. These new channels of communication can help Shenyang Jinshan to provide better information regarding Electric Utilities products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Shenyang Jinshan has some of the most successful models in the Electric Utilities industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Shenyang Jinshan should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of China, Shenyang Jinshan needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Shenyang Jinshan has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Electric Utilities industry over the last five years. Shenyang Jinshan 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.
Capital Spending Reduction
– Even during the low interest decade, Shenyang Jinshan 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 Electric Utilities industry using digital technology.
High dependence on Shenyang Jinshan ‘s star products
– The top 2 products and services of Shenyang Jinshan still accounts for major business revenue. This dependence on star products in Electric Utilities industry has resulted into insufficient focus on developing new products, even though Shenyang Jinshan has relatively successful track record of launching new products.
Shenyang Jinshan Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Shenyang Jinshan are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Shenyang Jinshan 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 Shenyang Jinshan to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Shenyang Jinshan 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 Electric Utilities industry.
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. Shenyang Jinshan can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Shenyang Jinshan can improve the customer journey of consumers in the Electric Utilities 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shenyang Jinshan in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Electric Utilities industry, and it will provide faster access to the consumers.
Use of Bitcoin and other crypto currencies for transactions in Electric Utilities industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Shenyang Jinshan in the Electric Utilities industry. Now Shenyang Jinshan can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Shenyang Jinshan can develop new processes and procedures in Electric Utilities 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Shenyang Jinshan 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 Shenyang Jinshan 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
– Shenyang Jinshan 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.
Learning at scale
– Online learning technologies has now opened space for Shenyang Jinshan to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Shenyang Jinshan is facing challenges because of the dominance of functional experts in the organization. Shenyang Jinshan can utilize new technology in the field of Electric Utilities industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Shenyang Jinshan 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, Shenyang Jinshan can use these opportunities to build new business models that can help the communities that Shenyang Jinshan operates in. Secondly it can use opportunities from government spending in Electric Utilities sector.
Threats Shenyang Jinshan External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Shenyang Jinshan are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Shenyang Jinshan may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electric Utilities sector.
Environmental challenges
– Shenyang Jinshan 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. Shenyang Jinshan can take advantage of this fund but it will also bring new competitors in the Electric Utilities industry.
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.
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. Shenyang Jinshan 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 Shenyang Jinshan.
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 Shenyang Jinshan in the Electric Utilities sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Shenyang Jinshan in Electric Utilities industry. The Electric Utilities 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.
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. Shenyang Jinshan needs to understand the core reasons impacting the Electric Utilities industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Shenyang Jinshan 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 Electric Utilities industry.
Easy access to finance
– Easy access to finance in Electric Utilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Shenyang Jinshan can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Shenyang Jinshan
– 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 Shenyang Jinshan.
Technology acceleration in Forth Industrial Revolution
– Shenyang Jinshan has witnessed rapid integration of technology during Covid-19 in the Electric Utilities industry. As one of the leading players in the industry, Shenyang Jinshan needs to keep up with the evolution of technology in the Electric Utilities 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Shenyang Jinshan 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 Shenyang Jinshan prominent markets.
Weighted SWOT Analysis of Shenyang Jinshan Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shenyang Jinshan 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 Shenyang Jinshan 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 Shenyang Jinshan 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 Shenyang Jinshan 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 Shenyang Jinshan needs to make to build a sustainable competitive advantage.