SWOT Analysis / TOWS Matrix for Tianshui Zhongxing Bio-tech (China)
Based on various researches at Oak Spring University , Tianshui Zhongxing Bio-tech is operating in a macro-environment that has been destablized by – technology disruption, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, increasing energy prices, increasing government debt because of Covid-19 spendings,
wage bills are increasing, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Tianshui Zhongxing Bio-tech
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tianshui Zhongxing Bio-tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tianshui Zhongxing Bio-tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech can be done for the following purposes –
1. Strategic planning of Tianshui Zhongxing Bio-tech
2. Improving business portfolio management of Tianshui Zhongxing Bio-tech
3. Assessing feasibility of the new initiative in China
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tianshui Zhongxing Bio-tech
Strengths of Tianshui Zhongxing Bio-tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tianshui Zhongxing Bio-tech are -
Sustainable margins compare to other players in Crops industry
– Tianshui Zhongxing Bio-tech has clearly differentiated products in the market place. This has enabled Tianshui Zhongxing Bio-tech to fetch slight price premium compare to the competitors in the Crops industry. The sustainable margins have also helped Tianshui Zhongxing Bio-tech to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Tianshui Zhongxing Bio-tech 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.
Ability to lead change in Crops
– Tianshui Zhongxing Bio-tech is one of the leading players in the Crops industry in China. Over the years it has not only transformed the business landscape in the Crops industry in China but also across the existing markets. The ability to lead change has enabled Tianshui Zhongxing Bio-tech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Tianshui Zhongxing Bio-tech 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.
Highly skilled collaborators
– Tianshui Zhongxing Bio-tech has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Crops industry. Secondly the value chain collaborators of Tianshui Zhongxing Bio-tech have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Tianshui Zhongxing Bio-tech in the Consumer/Non-Cyclical sector have low bargaining power. Tianshui Zhongxing Bio-tech has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tianshui Zhongxing Bio-tech to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Tianshui Zhongxing Bio-tech has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Tianshui Zhongxing Bio-tech staying ahead in the Crops industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Tianshui Zhongxing Bio-tech in Crops industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Tianshui Zhongxing Bio-tech is one of the most innovative firm in Crops sector.
Learning organization
- Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tianshui Zhongxing Bio-tech emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Tianshui Zhongxing Bio-tech
– The covid-19 pandemic has put organizational resilience at the centre of everthing Tianshui Zhongxing Bio-tech does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Tianshui Zhongxing Bio-tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tianshui Zhongxing Bio-tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Tianshui Zhongxing Bio-tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Tianshui Zhongxing Bio-tech are -
Aligning sales with marketing
– From the outside it seems that Tianshui Zhongxing Bio-tech needs to have more collaboration between its sales team and marketing team. Sales professionals in the Crops industry have deep experience in developing customer relationships. Marketing department at Tianshui Zhongxing Bio-tech can leverage the sales team experience to cultivate customer relationships as Tianshui Zhongxing Bio-tech is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Tianshui Zhongxing Bio-tech, in the dynamic environment of Crops industry it has struggled to respond to the nimble upstart competition. Tianshui Zhongxing Bio-tech has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Tianshui Zhongxing Bio-tech has a high cash cycle compare to other players in the Crops industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As Tianshui Zhongxing Bio-tech is one of the leading players in the Crops industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Crops industry in last five years.
Skills based hiring in Crops industry
– The stress on hiring functional specialists at Tianshui Zhongxing Bio-tech 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, Tianshui Zhongxing Bio-tech needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ less understanding of Tianshui Zhongxing Bio-tech strategy
– From the outside it seems that the employees of Tianshui Zhongxing Bio-tech 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.
Lack of clear differentiation of Tianshui Zhongxing Bio-tech products
– To increase the profitability and margins on the products, Tianshui Zhongxing Bio-tech needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners in Crops industry
– because of the regulatory requirements in China, Tianshui Zhongxing Bio-tech 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 Crops industry.
Interest costs
– Compare to the competition, Tianshui Zhongxing Bio-tech has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Slow decision making process
– As mentioned earlier in the report, Tianshui Zhongxing Bio-tech has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Crops industry over the last five years. Tianshui Zhongxing Bio-tech 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.
Tianshui Zhongxing Bio-tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Tianshui Zhongxing Bio-tech are -
Learning at scale
– Online learning technologies has now opened space for Tianshui Zhongxing Bio-tech 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.
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. Tianshui Zhongxing Bio-tech can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Tianshui Zhongxing Bio-tech 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.
Developing new processes and practices
– Tianshui Zhongxing Bio-tech can develop new processes and procedures in Crops 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tianshui Zhongxing Bio-tech can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Tianshui Zhongxing Bio-tech is facing challenges because of the dominance of functional experts in the organization. Tianshui Zhongxing Bio-tech can utilize new technology in the field of Crops industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Crops industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Tianshui Zhongxing Bio-tech 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. Tianshui Zhongxing Bio-tech 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.
Manufacturing automation
– Tianshui Zhongxing Bio-tech can use the latest technology developments to improve its manufacturing and designing process in Crops 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Tianshui Zhongxing Bio-tech 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.
Creating value in data economy
– The success of analytics program of Tianshui Zhongxing Bio-tech has opened avenues for new revenue streams for the organization in Crops industry. This can help Tianshui Zhongxing Bio-tech to build a more holistic ecosystem for Tianshui Zhongxing Bio-tech products in the Crops industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tianshui Zhongxing Bio-tech can use these opportunities to build new business models that can help the communities that Tianshui Zhongxing Bio-tech operates in. Secondly it can use opportunities from government spending in Crops sector.
Using analytics as competitive advantage
– Tianshui Zhongxing Bio-tech has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Crops sector. This continuous investment in analytics has enabled Tianshui Zhongxing Bio-tech to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tianshui Zhongxing Bio-tech to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Tianshui Zhongxing Bio-tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Tianshui Zhongxing Bio-tech are -
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. Tianshui Zhongxing Bio-tech needs to understand the core reasons impacting the Crops industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Crops industry are lowering. It can presents Tianshui Zhongxing Bio-tech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Crops sector.
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.
Easy access to finance
– Easy access to finance in Crops industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech
– 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 Tianshui Zhongxing Bio-tech.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech prominent markets.
Environmental challenges
– Tianshui Zhongxing Bio-tech 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. Tianshui Zhongxing Bio-tech can take advantage of this fund but it will also bring new competitors in the Crops industry.
Stagnating economy with rate increase
– Tianshui Zhongxing Bio-tech 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 Crops industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Tianshui Zhongxing Bio-tech in Crops industry. The Crops 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Tianshui Zhongxing Bio-tech may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops sector.
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. Tianshui Zhongxing Bio-tech will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Tianshui Zhongxing Bio-tech.
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.
Weighted SWOT Analysis of Tianshui Zhongxing Bio-tech Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech 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 Tianshui Zhongxing Bio-tech needs to make to build a sustainable competitive advantage.