Shenzhen Shengxunda A (300518) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Shenzhen Shengxunda A (China)

Based on various researches at Oak Spring University , Shenzhen Shengxunda A is operating in a macro-environment that has been destablized by – increasing energy prices, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, technology disruption, there is increasing trade war between United States & China, there is backlash against globalization, etc

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Introduction to SWOT Analysis of Shenzhen Shengxunda A

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

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

The strengths of Shenzhen Shengxunda A are -

Ability to lead change in Software & Programming

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

Learning organization

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

Training and development

– Shenzhen Shengxunda 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.

High brand equity

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

Digital Transformation in Software & Programming industry

- digital transformation varies from industry to industry. For Shenzhen Shengxunda A digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shenzhen Shengxunda 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.

Sustainable margins compare to other players in Software & Programming industry

– Shenzhen Shengxunda A has clearly differentiated products in the market place. This has enabled Shenzhen Shengxunda A to fetch slight price premium compare to the competitors in the Software & Programming industry. The sustainable margins have also helped Shenzhen Shengxunda A to invest into research and development (R&D) and innovation.

Highly skilled collaborators

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

Innovation driven organization

– Shenzhen Shengxunda A is one of the most innovative firm in Software & Programming sector.

Successful track record of launching new products

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

Effective Research and Development (R&D)

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

Ability to recruit top talent

– Shenzhen Shengxunda A is one of the leading players in the Software & Programming 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 Shenzhen Shengxunda A in the Technology sector have low bargaining power. Shenzhen Shengxunda A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shenzhen Shengxunda A to manage not only supply disruptions but also source products at highly competitive prices.

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

The weaknesses of Shenzhen Shengxunda A are -

High bargaining power of channel partners in Software & Programming industry

– because of the regulatory requirements in China, Shenzhen Shengxunda 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 Software & Programming industry.

Slow to strategic competitive environment developments

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

Slow decision making process

– As mentioned earlier in the report, Shenzhen Shengxunda 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 Software & Programming industry over the last five years. Shenzhen Shengxunda 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.

Lack of clear differentiation of Shenzhen Shengxunda A products

– To increase the profitability and margins on the products, Shenzhen Shengxunda A needs to provide more differentiated products than what it is currently offering in the marketplace.

High operating costs

– Compare to the competitors, Shenzhen Shengxunda A has high operating costs in the Software & Programming industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Shenzhen Shengxunda A lucrative customers.

Slow to harness new channels of communication

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

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 Shenzhen Shengxunda A supply chain. Even after few cautionary changes, Shenzhen Shengxunda A is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Shenzhen Shengxunda A vulnerable to further global disruptions in South East Asia.

Capital Spending Reduction

– Even during the low interest decade, Shenzhen Shengxunda 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 Software & Programming industry using digital technology.

Skills based hiring in Software & Programming industry

– The stress on hiring functional specialists at Shenzhen Shengxunda A 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, Shenzhen Shengxunda A needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Need for greater diversity

– Shenzhen Shengxunda A 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.

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

The opportunities of Shenzhen Shengxunda A are -

Loyalty marketing

– Shenzhen Shengxunda 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.

Manufacturing automation

– Shenzhen Shengxunda A can use the latest technology developments to improve its manufacturing and designing process in Software & Programming 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Software & Programming industry, but it has also influenced the consumer preferences. Shenzhen Shengxunda A 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

– Shenzhen Shengxunda A can improve the customer journey of consumers in the Software & Programming 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. Shenzhen Shengxunda A can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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 Shenzhen Shengxunda 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.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Software & Programming industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Shenzhen Shengxunda 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. Shenzhen Shengxunda 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.

Building a culture of innovation

– managers at Shenzhen Shengxunda 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 Software & Programming industry.

Developing new processes and practices

– Shenzhen Shengxunda A can develop new processes and procedures in Software & Programming 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.

Remote work and new talent hiring opportunities

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

Creating value in data economy

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

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Shenzhen Shengxunda A 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

– Shenzhen Shengxunda A has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Software & Programming sector. This continuous investment in analytics has enabled Shenzhen Shengxunda A to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shenzhen Shengxunda A 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 Shenzhen Shengxunda A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Shenzhen Shengxunda A are -

Increasing wage structure of Shenzhen Shengxunda A

– 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 Shenzhen Shengxunda A.

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 Shenzhen Shengxunda A business can come under increasing regulations regarding data privacy, data security, etc.

High dependence on third party suppliers

– Shenzhen Shengxunda 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Shenzhen Shengxunda A 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 Shenzhen Shengxunda A prominent markets.

Shortening product life cycle

– it is one of the major threat that Shenzhen Shengxunda A is facing in Software & Programming sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Shenzhen Shengxunda A may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Software & Programming sector.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Software & Programming industry are lowering. It can presents Shenzhen Shengxunda A with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Software & Programming sector.

Regulatory challenges

– Shenzhen Shengxunda 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 Software & Programming industry regulations.

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.

New competition

– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Shenzhen Shengxunda A in the Software & Programming sector and impact the bottomline of the organization.

Consumer confidence and its impact on Shenzhen Shengxunda 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 Software & Programming industry and other sectors.

Environmental challenges

– Shenzhen Shengxunda 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. Shenzhen Shengxunda A can take advantage of this fund but it will also bring new competitors in the Software & Programming industry.

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. Shenzhen Shengxunda A needs to understand the core reasons impacting the Software & Programming industry. This will help it in building a better workplace.

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Weighted SWOT Analysis of Shenzhen Shengxunda A Template, Example

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

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