Shanghai Shenqi Pharm B (900904) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Shanghai Shenqi Pharm B (China)

Based on various researches at Oak Spring University , Shanghai Shenqi Pharm B is operating in a macro-environment that has been destablized by – technology disruption, wage bills are increasing, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, etc

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Introduction to SWOT Analysis of Shanghai Shenqi Pharm B

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shanghai Shenqi Pharm B can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shanghai Shenqi Pharm B, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shanghai Shenqi Pharm B 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Shanghai Shenqi Pharm B can be done for the following purposes –
1. Strategic planning of Shanghai Shenqi Pharm B
2. Improving business portfolio management of Shanghai Shenqi Pharm B
3. Assessing feasibility of the new initiative in China
4. Making a Biotechnology & Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shanghai Shenqi Pharm B

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Strengths of Shanghai Shenqi Pharm B | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Shanghai Shenqi Pharm B are -

Highly skilled collaborators

– Shanghai Shenqi Pharm B has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Biotechnology & Drugs industry. Secondly the value chain collaborators of Shanghai Shenqi Pharm B have helped the firm to develop new products and bring them quickly to the marketplace.

Training and development

– Shanghai Shenqi Pharm B has one of the best training and development program in Healthcare 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.

Operational resilience

– The operational resilience strategy of Shanghai Shenqi Pharm B comprises – understanding the underlying the factors in the Biotechnology & Drugs 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.

High switching costs

– The high switching costs that Shanghai Shenqi Pharm B 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.

Sustainable margins compare to other players in Biotechnology & Drugs industry

– Shanghai Shenqi Pharm B has clearly differentiated products in the market place. This has enabled Shanghai Shenqi Pharm B to fetch slight price premium compare to the competitors in the Biotechnology & Drugs industry. The sustainable margins have also helped Shanghai Shenqi Pharm B to invest into research and development (R&D) and innovation.

Cross disciplinary teams

– Horizontal connected teams at the Shanghai Shenqi Pharm B 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.

Learning organization

- Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Shanghai Shenqi Pharm B emphasize – knowledge, initiative, and innovation.

Low bargaining power of suppliers

– Suppliers of Shanghai Shenqi Pharm B in the Healthcare sector have low bargaining power. Shanghai Shenqi Pharm B has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shanghai Shenqi Pharm B to manage not only supply disruptions but also source products at highly competitive prices.

Ability to lead change in Biotechnology & Drugs

– Shanghai Shenqi Pharm B is one of the leading players in the Biotechnology & Drugs industry in China. Over the years it has not only transformed the business landscape in the Biotechnology & Drugs industry in China but also across the existing markets. The ability to lead change has enabled Shanghai Shenqi Pharm B in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Strong track record of project management in the Biotechnology & Drugs industry

– Shanghai Shenqi Pharm B is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Digital Transformation in Biotechnology & Drugs industry

- digital transformation varies from industry to industry. For Shanghai Shenqi Pharm B digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shanghai Shenqi Pharm B 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 recruit top talent

– Shanghai Shenqi Pharm B is one of the leading players in the Biotechnology & Drugs 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.

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Weaknesses of Shanghai Shenqi Pharm B | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Shanghai Shenqi Pharm B are -

High dependence on Shanghai Shenqi Pharm B ‘s star products

– The top 2 products and services of Shanghai Shenqi Pharm B still accounts for major business revenue. This dependence on star products in Biotechnology & Drugs industry has resulted into insufficient focus on developing new products, even though Shanghai Shenqi Pharm B has relatively successful track record of launching new products.

Slow decision making process

– As mentioned earlier in the report, Shanghai Shenqi Pharm B has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Biotechnology & Drugs industry over the last five years. Shanghai Shenqi Pharm B 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.

Employees’ less understanding of Shanghai Shenqi Pharm B strategy

– From the outside it seems that the employees of Shanghai Shenqi Pharm B 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 cash cycle compare to competitors

Shanghai Shenqi Pharm B has a high cash cycle compare to other players in the Biotechnology & Drugs industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Need for greater diversity

– Shanghai Shenqi Pharm B 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.

Skills based hiring in Biotechnology & Drugs industry

– The stress on hiring functional specialists at Shanghai Shenqi Pharm B 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.

Workers concerns about automation

– As automation is fast increasing in the Biotechnology & Drugs industry, Shanghai Shenqi Pharm B needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.

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 Shanghai Shenqi Pharm B supply chain. Even after few cautionary changes, Shanghai Shenqi Pharm B is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Shanghai Shenqi Pharm B vulnerable to further global disruptions in South East Asia.

Slow to strategic competitive environment developments

– As Shanghai Shenqi Pharm B is one of the leading players in the Biotechnology & Drugs industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Biotechnology & Drugs industry in last five years.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shanghai Shenqi Pharm B is slow explore the new channels of communication. These new channels of communication can help Shanghai Shenqi Pharm B to provide better information regarding Biotechnology & Drugs products and services. It can also build an online community to further reach out to potential customers.

No frontier risks strategy

– From the 10K / annual statement of Shanghai Shenqi Pharm B, it seems that company is thinking out the frontier risks that can impact Biotechnology & Drugs 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.

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Shanghai Shenqi Pharm B Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Shanghai Shenqi Pharm B are -

Redefining models of collaboration and team work

– As explained in the weaknesses section, Shanghai Shenqi Pharm B is facing challenges because of the dominance of functional experts in the organization. Shanghai Shenqi Pharm B can utilize new technology in the field of Biotechnology & Drugs industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Shanghai Shenqi Pharm B in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Biotechnology & Drugs 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, Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

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. Shanghai Shenqi Pharm B can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Creating value in data economy

– The success of analytics program of Shanghai Shenqi Pharm B has opened avenues for new revenue streams for the organization in Biotechnology & Drugs industry. This can help Shanghai Shenqi Pharm B to build a more holistic ecosystem for Shanghai Shenqi Pharm B products in the Biotechnology & Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Shanghai Shenqi Pharm B can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Manufacturing automation

– Shanghai Shenqi Pharm B can use the latest technology developments to improve its manufacturing and designing process in Biotechnology & Drugs 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.

Leveraging digital technologies

– Shanghai Shenqi Pharm B 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.

Using analytics as competitive advantage

– Shanghai Shenqi Pharm B has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Biotechnology & Drugs sector. This continuous investment in analytics has enabled Shanghai Shenqi Pharm B to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shanghai Shenqi Pharm B to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Biotechnology & Drugs industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Shanghai Shenqi Pharm B 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. Shanghai Shenqi Pharm B 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Shanghai Shenqi Pharm B can use these opportunities to build new business models that can help the communities that Shanghai Shenqi Pharm B operates in. Secondly it can use opportunities from government spending in Biotechnology & Drugs sector.

Learning at scale

– Online learning technologies has now opened space for Shanghai Shenqi Pharm B 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Biotechnology & Drugs industry, but it has also influenced the consumer preferences. Shanghai Shenqi Pharm B can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

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Threats Shanghai Shenqi Pharm B External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Shanghai Shenqi Pharm B are -

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B prominent markets.

Increasing wage structure of Shanghai Shenqi Pharm B

– 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 Shanghai Shenqi Pharm B.

Technology acceleration in Forth Industrial Revolution

– Shanghai Shenqi Pharm B has witnessed rapid integration of technology during Covid-19 in the Biotechnology & Drugs industry. As one of the leading players in the industry, Shanghai Shenqi Pharm B needs to keep up with the evolution of technology in the Biotechnology & Drugs 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.

High dependence on third party suppliers

– Shanghai Shenqi Pharm B 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.

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.

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 Shanghai Shenqi Pharm B.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Shanghai Shenqi Pharm B may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Biotechnology & Drugs sector.

Consumer confidence and its impact on Shanghai Shenqi Pharm B 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 Biotechnology & Drugs industry and other sectors.

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 Shanghai Shenqi Pharm B 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. Shanghai Shenqi Pharm B needs to understand the core reasons impacting the Biotechnology & Drugs industry. This will help it in building a better workplace.

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 Shanghai Shenqi Pharm B in the Biotechnology & Drugs sector and impact the bottomline of the organization.

Environmental challenges

– Shanghai Shenqi Pharm B 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. Shanghai Shenqi Pharm B can take advantage of this fund but it will also bring new competitors in the Biotechnology & Drugs industry.

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. Shanghai Shenqi Pharm B 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.

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Weighted SWOT Analysis of Shanghai Shenqi Pharm B Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B 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 Shanghai Shenqi Pharm B needs to make to build a sustainable competitive advantage.

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