Based on various researches at Oak Spring University , Suzhou Tianma Specialty Chem is operating in a macro-environment that has been destablized by – increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing commodity prices, wage bills are increasing, etc
Introduction to SWOT Analysis of Suzhou Tianma Specialty Chem
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Suzhou Tianma Specialty Chem can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Suzhou Tianma Specialty Chem, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem can be done for the following purposes –
1. Strategic planning of Suzhou Tianma Specialty Chem
2. Improving business portfolio management of Suzhou Tianma Specialty Chem
3. Assessing feasibility of the new initiative in China
4. Making a Chemical Manufacturing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Suzhou Tianma Specialty Chem
Strengths of Suzhou Tianma Specialty Chem | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Suzhou Tianma Specialty Chem are -
High brand equity
– Suzhou Tianma Specialty Chem has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Suzhou Tianma Specialty Chem to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Suzhou Tianma Specialty Chem in Chemical Manufacturing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Suzhou Tianma Specialty Chem 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 Chemical Manufacturing 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 Chemical Manufacturing industry
– Suzhou Tianma Specialty Chem has clearly differentiated products in the market place. This has enabled Suzhou Tianma Specialty Chem to fetch slight price premium compare to the competitors in the Chemical Manufacturing industry. The sustainable margins have also helped Suzhou Tianma Specialty Chem to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Suzhou Tianma Specialty Chem 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.
Innovation driven organization
– Suzhou Tianma Specialty Chem is one of the most innovative firm in Chemical Manufacturing sector.
Successful track record of launching new products
– Suzhou Tianma Specialty Chem has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Suzhou Tianma Specialty Chem 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.
Ability to lead change in Chemical Manufacturing
– Suzhou Tianma Specialty Chem is one of the leading players in the Chemical Manufacturing industry in China. Over the years it has not only transformed the business landscape in the Chemical Manufacturing industry in China but also across the existing markets. The ability to lead change has enabled Suzhou Tianma Specialty Chem in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy of Suzhou Tianma Specialty Chem comprises – understanding the underlying the factors in the Chemical Manufacturing 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
– Suzhou Tianma Specialty Chem is one of the leading players in the Chemical Manufacturing 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.
Low bargaining power of suppliers
– Suppliers of Suzhou Tianma Specialty Chem in the Basic Materials sector have low bargaining power. Suzhou Tianma Specialty Chem has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Suzhou Tianma Specialty Chem to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Chemical Manufacturing industry
- digital transformation varies from industry to industry. For Suzhou Tianma Specialty Chem digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Suzhou Tianma Specialty Chem 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.
Weaknesses of Suzhou Tianma Specialty Chem | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Suzhou Tianma Specialty Chem are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Suzhou Tianma Specialty Chem is slow explore the new channels of communication. These new channels of communication can help Suzhou Tianma Specialty Chem to provide better information regarding Chemical Manufacturing products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Suzhou Tianma Specialty Chem products
– To increase the profitability and margins on the products, Suzhou Tianma Specialty Chem needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, Suzhou Tianma Specialty Chem has high operating costs in the Chemical Manufacturing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Suzhou Tianma Specialty Chem lucrative customers.
Skills based hiring in Chemical Manufacturing industry
– The stress on hiring functional specialists at Suzhou Tianma Specialty Chem 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.
Increasing silos among functional specialists
– The organizational structure of Suzhou Tianma Specialty Chem is dominated by functional specialists. It is not different from other players in the Chemical Manufacturing industry, but Suzhou Tianma Specialty Chem needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Suzhou Tianma Specialty Chem to focus more on services in the Chemical Manufacturing industry rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Suzhou Tianma Specialty Chem 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 Chemical Manufacturing industry using digital technology.
High cash cycle compare to competitors
Suzhou Tianma Specialty Chem has a high cash cycle compare to other players in the Chemical Manufacturing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– From the outside it seems that Suzhou Tianma Specialty Chem needs to have more collaboration between its sales team and marketing team. Sales professionals in the Chemical Manufacturing industry have deep experience in developing customer relationships. Marketing department at Suzhou Tianma Specialty Chem can leverage the sales team experience to cultivate customer relationships as Suzhou Tianma Specialty Chem is planning to shift buying processes online.
Employees’ less understanding of Suzhou Tianma Specialty Chem strategy
– From the outside it seems that the employees of Suzhou Tianma Specialty Chem 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.
Low market penetration in new markets
– Outside its home market of China, Suzhou Tianma Specialty Chem needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Suzhou Tianma Specialty Chem has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Suzhou Tianma Specialty Chem Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Suzhou Tianma Specialty Chem are -
Leveraging digital technologies
– Suzhou Tianma Specialty Chem 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Suzhou Tianma Specialty Chem in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Chemical Manufacturing industry, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Suzhou Tianma Specialty Chem has opened avenues for new revenue streams for the organization in Chemical Manufacturing industry. This can help Suzhou Tianma Specialty Chem to build a more holistic ecosystem for Suzhou Tianma Specialty Chem products in the Chemical Manufacturing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Suzhou Tianma Specialty Chem 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 Chemical Manufacturing industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Chemical Manufacturing industry, but it has also influenced the consumer preferences. Suzhou Tianma Specialty Chem can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Suzhou Tianma Specialty Chem 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Chemical Manufacturing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Suzhou Tianma Specialty Chem 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. Suzhou Tianma Specialty Chem 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.
Developing new processes and practices
– Suzhou Tianma Specialty Chem can develop new processes and procedures in Chemical Manufacturing 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.
Better consumer reach
– The expansion of the 5G network will help Suzhou Tianma Specialty Chem to increase its market reach. Suzhou Tianma Specialty Chem 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.
Manufacturing automation
– Suzhou Tianma Specialty Chem can use the latest technology developments to improve its manufacturing and designing process in Chemical Manufacturing 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Suzhou Tianma Specialty Chem is facing challenges because of the dominance of functional experts in the organization. Suzhou Tianma Specialty Chem can utilize new technology in the field of Chemical Manufacturing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem to hire the very best people irrespective of their geographical location.
Threats Suzhou Tianma Specialty Chem External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Suzhou Tianma Specialty Chem are -
Increasing wage structure of Suzhou Tianma Specialty Chem
– 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 Suzhou Tianma Specialty Chem.
Technology acceleration in Forth Industrial Revolution
– Suzhou Tianma Specialty Chem has witnessed rapid integration of technology during Covid-19 in the Chemical Manufacturing industry. As one of the leading players in the industry, Suzhou Tianma Specialty Chem needs to keep up with the evolution of technology in the Chemical Manufacturing 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.
Shortening product life cycle
– it is one of the major threat that Suzhou Tianma Specialty Chem is facing in Chemical Manufacturing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Suzhou Tianma Specialty Chem 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. Suzhou Tianma Specialty Chem can take advantage of this fund but it will also bring new competitors in the Chemical Manufacturing 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.
Stagnating economy with rate increase
– Suzhou Tianma Specialty Chem 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 Chemical Manufacturing industry.
High dependence on third party suppliers
– Suzhou Tianma Specialty Chem 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Suzhou Tianma Specialty Chem may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Chemical Manufacturing sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Suzhou Tianma Specialty Chem in Chemical Manufacturing industry. The Chemical Manufacturing 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem prominent markets.
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 Suzhou Tianma Specialty Chem in the Chemical Manufacturing sector and impact the bottomline of the organization.
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.
Consumer confidence and its impact on Suzhou Tianma Specialty Chem 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 Chemical Manufacturing industry and other sectors.
Weighted SWOT Analysis of Suzhou Tianma Specialty Chem Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem 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 Suzhou Tianma Specialty Chem needs to make to build a sustainable competitive advantage.
