Kangqiang Elect A (2119) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Kangqiang Elect A (China)

Based on various researches at Oak Spring University , Kangqiang Elect A is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, 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, etc

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Introduction to SWOT Analysis of Kangqiang Elect A

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kangqiang Elect A can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kangqiang Elect A, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kangqiang Elect A 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 Kangqiang Elect A can be done for the following purposes –
1. Strategic planning of Kangqiang Elect A
2. Improving business portfolio management of Kangqiang Elect A
3. Assessing feasibility of the new initiative in China
4. Making a Semiconductors sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kangqiang Elect A

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Strengths of Kangqiang Elect A | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Kangqiang Elect A are -

Analytics focus

– Kangqiang Elect A 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 Semiconductors 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.

High brand equity

– Kangqiang Elect A has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kangqiang Elect A to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Diverse revenue streams

– Kangqiang Elect A is present in almost all the verticals within the Semiconductors industry. This has provided Kangqiang Elect A 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 Semiconductors industry

– Kangqiang Elect A is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Operational resilience

– The operational resilience strategy of Kangqiang Elect A comprises – understanding the underlying the factors in the Semiconductors 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.

Digital Transformation in Semiconductors industry

- digital transformation varies from industry to industry. For Kangqiang Elect A digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kangqiang Elect A 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 Kangqiang Elect A in the Technology sector have low bargaining power. Kangqiang Elect A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kangqiang Elect A to manage not only supply disruptions but also source products at highly competitive prices.

Organizational Resilience of Kangqiang Elect A

– The covid-19 pandemic has put organizational resilience at the centre of everthing Kangqiang Elect A does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Highly skilled collaborators

– Kangqiang Elect A has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Semiconductors industry. Secondly the value chain collaborators of Kangqiang Elect A have helped the firm to develop new products and bring them quickly to the marketplace.

Learning organization

- Kangqiang Elect A 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 Kangqiang Elect A is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Kangqiang Elect A emphasize – knowledge, initiative, and innovation.

Successful track record of launching new products

– Kangqiang Elect A has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kangqiang Elect A 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.

Training and development

– Kangqiang Elect A has one of the best training and development program in Technology 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.

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Weaknesses of Kangqiang Elect A | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Kangqiang Elect A are -

Slow to strategic competitive environment developments

– As Kangqiang Elect A is one of the leading players in the Semiconductors industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Semiconductors industry in last five years.

Low market penetration in new markets

– Outside its home market of China, Kangqiang Elect A needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kangqiang Elect A is slow explore the new channels of communication. These new channels of communication can help Kangqiang Elect A to provide better information regarding Semiconductors products and services. It can also build an online community to further reach out to potential customers.

High dependence on Kangqiang Elect A ‘s star products

– The top 2 products and services of Kangqiang Elect A still accounts for major business revenue. This dependence on star products in Semiconductors industry has resulted into insufficient focus on developing new products, even though Kangqiang Elect A has relatively successful track record of launching new products.

Products dominated business model

– Even though Kangqiang Elect A has some of the most successful models in the Semiconductors industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Kangqiang Elect A should strive to include more intangible value offerings along with its core products and services.

Aligning sales with marketing

– From the outside it seems that Kangqiang Elect A needs to have more collaboration between its sales team and marketing team. Sales professionals in the Semiconductors industry have deep experience in developing customer relationships. Marketing department at Kangqiang Elect A can leverage the sales team experience to cultivate customer relationships as Kangqiang Elect A is planning to shift buying processes online.

High bargaining power of channel partners in Semiconductors industry

– because of the regulatory requirements in China, Kangqiang Elect A is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Semiconductors industry.

Interest costs

– Compare to the competition, Kangqiang Elect A 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.

Employees’ less understanding of Kangqiang Elect A strategy

– From the outside it seems that the employees of Kangqiang Elect A 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.

Capital Spending Reduction

– Even during the low interest decade, Kangqiang Elect A 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 Semiconductors industry using digital technology.

Slow decision making process

– As mentioned earlier in the report, Kangqiang Elect A has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Semiconductors industry over the last five years. Kangqiang Elect A 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.

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Kangqiang Elect A Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Kangqiang Elect A are -

Finding new ways to collaborate

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

Loyalty marketing

– Kangqiang Elect A 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.

Building a culture of innovation

– managers at Kangqiang Elect A 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 Semiconductors industry.

Using analytics as competitive advantage

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

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kangqiang Elect A 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 Kangqiang Elect A to hire the very best people irrespective of their geographical location.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Kangqiang Elect A in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Semiconductors industry, and it will provide faster access to the consumers.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Semiconductors industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kangqiang Elect A 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. Kangqiang Elect A 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.

Use of Bitcoin and other crypto currencies for transactions in Semiconductors industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Kangqiang Elect A in the Semiconductors industry. Now Kangqiang Elect A can target international markets with far fewer capital restrictions requirements than the existing system.

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. Kangqiang Elect A can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Low interest rates

– Even though inflation is raising its head in most developed economies, Kangqiang Elect A 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.

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 Kangqiang Elect A 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kangqiang Elect A can use these opportunities to build new business models that can help the communities that Kangqiang Elect A operates in. Secondly it can use opportunities from government spending in Semiconductors sector.

Creating value in data economy

– The success of analytics program of Kangqiang Elect A has opened avenues for new revenue streams for the organization in Semiconductors industry. This can help Kangqiang Elect A to build a more holistic ecosystem for Kangqiang Elect A products in the Semiconductors industry by providing – data insight services, data privacy related products, data based consulting services, etc.

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Threats Kangqiang Elect A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Kangqiang Elect A are -

Backlash against dominant players

– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Kangqiang Elect A business can come under increasing regulations regarding data privacy, data security, etc.

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 Kangqiang Elect A.

Consumer confidence and its impact on Kangqiang Elect A 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 Semiconductors industry and other sectors.

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. Kangqiang Elect A needs to understand the core reasons impacting the Semiconductors industry. This will help it in building a better workplace.

Environmental challenges

– Kangqiang Elect A 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. Kangqiang Elect A can take advantage of this fund but it will also bring new competitors in the Semiconductors industry.

Easy access to finance

– Easy access to finance in Semiconductors industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kangqiang Elect A can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

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.

Technology acceleration in Forth Industrial Revolution

– Kangqiang Elect A has witnessed rapid integration of technology during Covid-19 in the Semiconductors industry. As one of the leading players in the industry, Kangqiang Elect A needs to keep up with the evolution of technology in the Semiconductors 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.

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. Kangqiang Elect A 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.

High dependence on third party suppliers

– Kangqiang Elect A 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.

Shortening product life cycle

– it is one of the major threat that Kangqiang Elect A is facing in Semiconductors sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Kangqiang Elect A in Semiconductors industry. The Semiconductors 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.

Regulatory challenges

– Kangqiang Elect A needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Semiconductors industry regulations.

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Weighted SWOT Analysis of Kangqiang Elect A Template, Example

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

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