Jiangsu Huahong Technology Co Ltd (2645) SWOT Analysis / TOWS Matrix / MBA Resources
Containers & Packaging
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Jiangsu Huahong Technology Co Ltd (China)
Based on various researches at Oak Spring University , Jiangsu Huahong Technology Co Ltd is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, increasing commodity prices, cloud computing is disrupting traditional business models, technology disruption, supply chains are disrupted by pandemic ,
increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Jiangsu Huahong Technology Co Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jiangsu Huahong Technology Co Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jiangsu Huahong Technology Co Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd can be done for the following purposes –
1. Strategic planning of Jiangsu Huahong Technology Co Ltd
2. Improving business portfolio management of Jiangsu Huahong Technology Co Ltd
3. Assessing feasibility of the new initiative in China
4. Making a Containers & Packaging sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jiangsu Huahong Technology Co Ltd
Strengths of Jiangsu Huahong Technology Co Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jiangsu Huahong Technology Co Ltd are -
Diverse revenue streams
– Jiangsu Huahong Technology Co Ltd is present in almost all the verticals within the Containers & Packaging industry. This has provided Jiangsu Huahong Technology Co Ltd 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.
Strong track record of project management in the Containers & Packaging industry
– Jiangsu Huahong Technology Co Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Jiangsu Huahong Technology Co Ltd 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.
Analytics focus
– Jiangsu Huahong Technology Co Ltd 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 Containers & Packaging 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.
Innovation driven organization
– Jiangsu Huahong Technology Co Ltd is one of the most innovative firm in Containers & Packaging sector.
Sustainable margins compare to other players in Containers & Packaging industry
– Jiangsu Huahong Technology Co Ltd has clearly differentiated products in the market place. This has enabled Jiangsu Huahong Technology Co Ltd to fetch slight price premium compare to the competitors in the Containers & Packaging industry. The sustainable margins have also helped Jiangsu Huahong Technology Co Ltd to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Jiangsu Huahong Technology Co Ltd in Containers & Packaging industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Jiangsu Huahong Technology Co Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jiangsu Huahong Technology Co Ltd 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.
Low bargaining power of suppliers
– Suppliers of Jiangsu Huahong Technology Co Ltd in the Basic Materials sector have low bargaining power. Jiangsu Huahong Technology Co Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jiangsu Huahong Technology Co Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Jiangsu Huahong Technology Co Ltd is one of the leading players in the Containers & Packaging 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.
Ability to lead change in Containers & Packaging
– Jiangsu Huahong Technology Co Ltd is one of the leading players in the Containers & Packaging industry in China. Over the years it has not only transformed the business landscape in the Containers & Packaging industry in China but also across the existing markets. The ability to lead change has enabled Jiangsu Huahong Technology Co Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Jiangsu Huahong Technology Co Ltd has one of the best training and development program in Basic Materials 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.
Weaknesses of Jiangsu Huahong Technology Co Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jiangsu Huahong Technology Co Ltd are -
Need for greater diversity
– Jiangsu Huahong Technology Co Ltd 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.
Interest costs
– Compare to the competition, Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd products
– To increase the profitability and margins on the products, Jiangsu Huahong Technology Co Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Jiangsu Huahong Technology Co Ltd has a high cash cycle compare to other players in the Containers & Packaging industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Compensation and incentives
– The revenue per employee of Jiangsu Huahong Technology Co Ltd is just above the Containers & Packaging industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
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 Jiangsu Huahong Technology Co Ltd supply chain. Even after few cautionary changes, Jiangsu Huahong Technology Co Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jiangsu Huahong Technology Co Ltd vulnerable to further global disruptions in South East Asia.
Skills based hiring in Containers & Packaging industry
– The stress on hiring functional specialists at Jiangsu Huahong Technology Co Ltd 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.
Low market penetration in new markets
– Outside its home market of China, Jiangsu Huahong Technology Co Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Jiangsu Huahong Technology Co Ltd is dominated by functional specialists. It is not different from other players in the Containers & Packaging industry, but Jiangsu Huahong Technology Co Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Jiangsu Huahong Technology Co Ltd to focus more on services in the Containers & Packaging industry rather than just following the product oriented approach.
High dependence on Jiangsu Huahong Technology Co Ltd ‘s star products
– The top 2 products and services of Jiangsu Huahong Technology Co Ltd still accounts for major business revenue. This dependence on star products in Containers & Packaging industry has resulted into insufficient focus on developing new products, even though Jiangsu Huahong Technology Co Ltd has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at Jiangsu Huahong Technology Co Ltd, in the dynamic environment of Containers & Packaging industry it has struggled to respond to the nimble upstart competition. Jiangsu Huahong Technology Co Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Jiangsu Huahong Technology Co Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jiangsu Huahong Technology Co Ltd are -
Manufacturing automation
– Jiangsu Huahong Technology Co Ltd can use the latest technology developments to improve its manufacturing and designing process in Containers & Packaging 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.
Buying journey improvements
– Jiangsu Huahong Technology Co Ltd can improve the customer journey of consumers in the Containers & Packaging 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.
Better consumer reach
– The expansion of the 5G network will help Jiangsu Huahong Technology Co Ltd to increase its market reach. Jiangsu Huahong Technology Co Ltd 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.
Using analytics as competitive advantage
– Jiangsu Huahong Technology Co Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Containers & Packaging sector. This continuous investment in analytics has enabled Jiangsu Huahong Technology Co Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jiangsu Huahong Technology Co Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Jiangsu Huahong Technology Co Ltd can develop new processes and procedures in Containers & Packaging 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Containers & Packaging industry, but it has also influenced the consumer preferences. Jiangsu Huahong Technology Co Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Jiangsu Huahong Technology Co Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jiangsu Huahong Technology Co Ltd is facing challenges because of the dominance of functional experts in the organization. Jiangsu Huahong Technology Co Ltd can utilize new technology in the field of Containers & Packaging industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Jiangsu Huahong Technology Co Ltd 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jiangsu Huahong Technology Co Ltd 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.
Leveraging digital technologies
– Jiangsu Huahong Technology Co Ltd 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.
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 Jiangsu Huahong Technology Co Ltd 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jiangsu Huahong Technology Co Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Jiangsu Huahong Technology Co Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jiangsu Huahong Technology Co Ltd are -
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. Jiangsu Huahong Technology Co Ltd 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.
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 Jiangsu Huahong Technology Co Ltd in the Containers & Packaging sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Containers & Packaging industry are lowering. It can presents Jiangsu Huahong Technology Co Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Containers & Packaging sector.
Stagnating economy with rate increase
– Jiangsu Huahong Technology Co Ltd 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 Containers & Packaging industry.
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 Jiangsu Huahong Technology Co Ltd.
Consumer confidence and its impact on Jiangsu Huahong Technology Co Ltd 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 Containers & Packaging industry and other sectors.
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.
Environmental challenges
– Jiangsu Huahong Technology Co Ltd 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. Jiangsu Huahong Technology Co Ltd can take advantage of this fund but it will also bring new competitors in the Containers & Packaging industry.
Easy access to finance
– Easy access to finance in Containers & Packaging industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd
– 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 Jiangsu Huahong Technology Co Ltd.
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.
Shortening product life cycle
– it is one of the major threat that Jiangsu Huahong Technology Co Ltd is facing in Containers & Packaging sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Jiangsu Huahong Technology Co Ltd may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Containers & Packaging sector.
Weighted SWOT Analysis of Jiangsu Huahong Technology Co Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd 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 Jiangsu Huahong Technology Co Ltd needs to make to build a sustainable competitive advantage.
