SWOT Analysis / TOWS Matrix for ChongQing Zhengchuan Pharma (China)
Based on various researches at Oak Spring University , ChongQing Zhengchuan Pharma is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, geopolitical disruptions, there is backlash against globalization, talent flight as more people leaving formal jobs, wage bills are increasing, increasing energy prices, challanges to central banks by blockchain based private currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of ChongQing Zhengchuan Pharma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that ChongQing Zhengchuan Pharma can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the ChongQing Zhengchuan Pharma, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma can be done for the following purposes –
1. Strategic planning of ChongQing Zhengchuan Pharma
2. Improving business portfolio management of ChongQing Zhengchuan Pharma
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 ChongQing Zhengchuan Pharma
Strengths of ChongQing Zhengchuan Pharma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of ChongQing Zhengchuan Pharma are -
Innovation driven organization
– ChongQing Zhengchuan Pharma is one of the most innovative firm in Containers & Packaging sector.
Ability to recruit top talent
– ChongQing Zhengchuan Pharma 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.
Low bargaining power of suppliers
– Suppliers of ChongQing Zhengchuan Pharma in the Basic Materials sector have low bargaining power. ChongQing Zhengchuan Pharma has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps ChongQing Zhengchuan Pharma to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– ChongQing Zhengchuan Pharma has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled ChongQing Zhengchuan Pharma to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Containers & Packaging industry
- digital transformation varies from industry to industry. For ChongQing Zhengchuan Pharma digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. ChongQing Zhengchuan Pharma 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.
Analytics focus
– ChongQing Zhengchuan Pharma 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.
Training and development
– ChongQing Zhengchuan Pharma 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.
Strong track record of project management in the Containers & Packaging industry
– ChongQing Zhengchuan Pharma is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of ChongQing Zhengchuan Pharma in Containers & Packaging industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the ChongQing Zhengchuan Pharma 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.
Sustainable margins compare to other players in Containers & Packaging industry
– ChongQing Zhengchuan Pharma has clearly differentiated products in the market place. This has enabled ChongQing Zhengchuan Pharma to fetch slight price premium compare to the competitors in the Containers & Packaging industry. The sustainable margins have also helped ChongQing Zhengchuan Pharma to invest into research and development (R&D) and innovation.
Organizational Resilience of ChongQing Zhengchuan Pharma
– The covid-19 pandemic has put organizational resilience at the centre of everthing ChongQing Zhengchuan Pharma does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of ChongQing Zhengchuan Pharma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ChongQing Zhengchuan Pharma are -
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 ChongQing Zhengchuan Pharma supply chain. Even after few cautionary changes, ChongQing Zhengchuan Pharma is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left ChongQing Zhengchuan Pharma vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, ChongQing Zhengchuan Pharma has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Containers & Packaging industry over the last five years. ChongQing Zhengchuan Pharma 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.
No frontier risks strategy
– From the 10K / annual statement of ChongQing Zhengchuan Pharma, it seems that company is thinking out the frontier risks that can impact Containers & Packaging 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.
High operating costs
– Compare to the competitors, ChongQing Zhengchuan Pharma has high operating costs in the Containers & Packaging industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract ChongQing Zhengchuan Pharma lucrative customers.
Need for greater diversity
– ChongQing Zhengchuan Pharma 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 Containers & Packaging industry
– The stress on hiring functional specialists at ChongQing Zhengchuan Pharma 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, ChongQing Zhengchuan Pharma is slow explore the new channels of communication. These new channels of communication can help ChongQing Zhengchuan Pharma to provide better information regarding Containers & Packaging products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As ChongQing Zhengchuan Pharma is one of the leading players in the Containers & Packaging industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Containers & Packaging industry in last five years.
High bargaining power of channel partners in Containers & Packaging industry
– because of the regulatory requirements in China, ChongQing Zhengchuan Pharma 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 Containers & Packaging industry.
Compensation and incentives
– The revenue per employee of ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma ‘s star products
– The top 2 products and services of ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma has relatively successful track record of launching new products.
ChongQing Zhengchuan Pharma Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of ChongQing Zhengchuan Pharma are -
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. ChongQing Zhengchuan Pharma can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– ChongQing Zhengchuan Pharma 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.
Creating value in data economy
– The success of analytics program of ChongQing Zhengchuan Pharma has opened avenues for new revenue streams for the organization in Containers & Packaging industry. This can help ChongQing Zhengchuan Pharma to build a more holistic ecosystem for ChongQing Zhengchuan Pharma products in the Containers & Packaging industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for ChongQing Zhengchuan Pharma 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Containers & Packaging industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. ChongQing Zhengchuan Pharma 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. ChongQing Zhengchuan Pharma 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
– ChongQing Zhengchuan Pharma 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.
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 ChongQing Zhengchuan Pharma 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.
Use of Bitcoin and other crypto currencies for transactions in Containers & Packaging industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for ChongQing Zhengchuan Pharma in the Containers & Packaging industry. Now ChongQing Zhengchuan Pharma can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– ChongQing Zhengchuan Pharma 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects ChongQing Zhengchuan Pharma can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, ChongQing Zhengchuan Pharma can use these opportunities to build new business models that can help the communities that ChongQing Zhengchuan Pharma operates in. Secondly it can use opportunities from government spending in Containers & Packaging sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, ChongQing Zhengchuan Pharma 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.
Threats ChongQing Zhengchuan Pharma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of ChongQing Zhengchuan Pharma are -
Environmental challenges
– ChongQing Zhengchuan Pharma 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. ChongQing Zhengchuan Pharma can take advantage of this fund but it will also bring new competitors in the Containers & Packaging industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Containers & Packaging industry are lowering. It can presents ChongQing Zhengchuan Pharma with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Containers & Packaging sector.
Regulatory challenges
– ChongQing Zhengchuan Pharma 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 Containers & Packaging industry regulations.
Stagnating economy with rate increase
– ChongQing Zhengchuan Pharma 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.
High dependence on third party suppliers
– ChongQing Zhengchuan Pharma 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.
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. ChongQing Zhengchuan Pharma 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.
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 ChongQing Zhengchuan Pharma business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma prominent markets.
Increasing wage structure of ChongQing Zhengchuan Pharma
– 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 ChongQing Zhengchuan Pharma.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for ChongQing Zhengchuan Pharma in Containers & Packaging industry. The Containers & Packaging 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.
Consumer confidence and its impact on ChongQing Zhengchuan Pharma 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.
Shortening product life cycle
– it is one of the major threat that ChongQing Zhengchuan Pharma is facing in Containers & Packaging sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of ChongQing Zhengchuan Pharma Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma 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 ChongQing Zhengchuan Pharma needs to make to build a sustainable competitive advantage.