XiAn Tian He Defense (300397) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for XiAn Tian He Defense (China)

Based on various researches at Oak Spring University , XiAn Tian He Defense is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, increasing energy prices, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, etc

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Introduction to SWOT Analysis of XiAn Tian He Defense

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

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Strengths of XiAn Tian He Defense | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of XiAn Tian He Defense are -

Effective Research and Development (R&D)

– XiAn Tian He Defense has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – XiAn Tian He Defense staying ahead in the Aerospace & Defense industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Operational resilience

– The operational resilience strategy of XiAn Tian He Defense comprises – understanding the underlying the factors in the Aerospace & Defense 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.

Cross disciplinary teams

– Horizontal connected teams at the XiAn Tian He Defense 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.

Training and development

– XiAn Tian He Defense has one of the best training and development program in Capital Goods 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.

Analytics focus

– XiAn Tian He Defense 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 Aerospace & Defense 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

– XiAn Tian He Defense has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled XiAn Tian He Defense to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Sustainable margins compare to other players in Aerospace & Defense industry

– XiAn Tian He Defense has clearly differentiated products in the market place. This has enabled XiAn Tian He Defense to fetch slight price premium compare to the competitors in the Aerospace & Defense industry. The sustainable margins have also helped XiAn Tian He Defense to invest into research and development (R&D) and innovation.

Ability to recruit top talent

– XiAn Tian He Defense is one of the leading players in the Aerospace & Defense 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.

Strong track record of project management in the Aerospace & Defense industry

– XiAn Tian He Defense is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Highly skilled collaborators

– XiAn Tian He Defense has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Aerospace & Defense industry. Secondly the value chain collaborators of XiAn Tian He Defense have helped the firm to develop new products and bring them quickly to the marketplace.

Diverse revenue streams

– XiAn Tian He Defense is present in almost all the verticals within the Aerospace & Defense industry. This has provided XiAn Tian He Defense 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.

Ability to lead change in Aerospace & Defense

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

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Weaknesses of XiAn Tian He Defense | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of XiAn Tian He Defense are -

Slow to strategic competitive environment developments

– As XiAn Tian He Defense is one of the leading players in the Aerospace & Defense industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Aerospace & Defense industry in last five years.

Aligning sales with marketing

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

Slow to harness new channels of communication

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

Need for greater diversity

– XiAn Tian He Defense 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.

High cash cycle compare to competitors

XiAn Tian He Defense has a high cash cycle compare to other players in the Aerospace & Defense industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Lack of clear differentiation of XiAn Tian He Defense products

– To increase the profitability and margins on the products, XiAn Tian He Defense needs to provide more differentiated products than what it is currently offering in the marketplace.

Products dominated business model

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

Capital Spending Reduction

– Even during the low interest decade, XiAn Tian He Defense 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 Aerospace & Defense industry using digital technology.

Ability to respond to the competition

– As the decision making is very deliberative at XiAn Tian He Defense, in the dynamic environment of Aerospace & Defense industry it has struggled to respond to the nimble upstart competition. XiAn Tian He Defense has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Low market penetration in new markets

– Outside its home market of China, XiAn Tian He Defense needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Skills based hiring in Aerospace & Defense industry

– The stress on hiring functional specialists at XiAn Tian He Defense 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.

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XiAn Tian He Defense Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of XiAn Tian He Defense are -

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for XiAn Tian He Defense 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 XiAn Tian He Defense to hire the very best people irrespective of their geographical location.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, XiAn Tian He Defense 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 XiAn Tian He Defense 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 XiAn Tian He Defense 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.

Use of Bitcoin and other crypto currencies for transactions in Aerospace & Defense industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for XiAn Tian He Defense in the Aerospace & Defense industry. Now XiAn Tian He Defense can target international markets with far fewer capital restrictions requirements than the existing system.

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 XiAn Tian He Defense 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.

Loyalty marketing

– XiAn Tian He Defense 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.

Leveraging digital technologies

– XiAn Tian He Defense 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.

Buying journey improvements

– XiAn Tian He Defense can improve the customer journey of consumers in the Aerospace & Defense 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.

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. XiAn Tian He Defense can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Creating value in data economy

– The success of analytics program of XiAn Tian He Defense has opened avenues for new revenue streams for the organization in Aerospace & Defense industry. This can help XiAn Tian He Defense to build a more holistic ecosystem for XiAn Tian He Defense products in the Aerospace & Defense industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Developing new processes and practices

– XiAn Tian He Defense can develop new processes and procedures in Aerospace & Defense 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 XiAn Tian He Defense can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Using analytics as competitive advantage

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

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Threats XiAn Tian He Defense External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of XiAn Tian He Defense are -

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Aerospace & Defense industry are lowering. It can presents XiAn Tian He Defense with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Aerospace & Defense sector.

Stagnating economy with rate increase

– XiAn Tian He Defense 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 Aerospace & Defense industry.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, XiAn Tian He Defense may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Aerospace & Defense sector.

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. XiAn Tian He Defense needs to understand the core reasons impacting the Aerospace & Defense industry. This will help it in building a better workplace.

Environmental challenges

– XiAn Tian He Defense 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. XiAn Tian He Defense can take advantage of this fund but it will also bring new competitors in the Aerospace & Defense industry.

Technology acceleration in Forth Industrial Revolution

– XiAn Tian He Defense has witnessed rapid integration of technology during Covid-19 in the Aerospace & Defense industry. As one of the leading players in the industry, XiAn Tian He Defense needs to keep up with the evolution of technology in the Aerospace & Defense 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.

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 XiAn Tian He Defense business can come under increasing regulations regarding data privacy, data security, etc.

Aging population

– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of XiAn Tian He Defense.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for XiAn Tian He Defense in Aerospace & Defense industry. The Aerospace & Defense 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.

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.

Consumer confidence and its impact on XiAn Tian He Defense 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 Aerospace & Defense industry and other sectors.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, XiAn Tian He Defense 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 XiAn Tian He Defense prominent markets.

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Weighted SWOT Analysis of XiAn Tian He Defense Template, Example

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

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