SWOT Analysis / TOWS Matrix for TianYu Eco-Environment (China)
Based on various researches at Oak Spring University , TianYu Eco-Environment is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, technology disruption, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models,
challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of TianYu Eco-Environment
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that TianYu Eco-Environment can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the TianYu Eco-Environment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which TianYu Eco-Environment 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 TianYu Eco-Environment can be done for the following purposes –
1. Strategic planning of TianYu Eco-Environment
2. Improving business portfolio management of TianYu Eco-Environment
3. Assessing feasibility of the new initiative in China
4. Making a Personal Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of TianYu Eco-Environment
Strengths of TianYu Eco-Environment | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of TianYu Eco-Environment are -
Sustainable margins compare to other players in Personal Services industry
– TianYu Eco-Environment has clearly differentiated products in the market place. This has enabled TianYu Eco-Environment to fetch slight price premium compare to the competitors in the Personal Services industry. The sustainable margins have also helped TianYu Eco-Environment to invest into research and development (R&D) and innovation.
Ability to lead change in Personal Services
– TianYu Eco-Environment is one of the leading players in the Personal Services industry in China. Over the years it has not only transformed the business landscape in the Personal Services industry in China but also across the existing markets. The ability to lead change has enabled TianYu Eco-Environment in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of TianYu Eco-Environment in Personal Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– TianYu Eco-Environment has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled TianYu Eco-Environment to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Personal Services industry
- digital transformation varies from industry to industry. For TianYu Eco-Environment digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. TianYu Eco-Environment 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
– TianYu Eco-Environment 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 Personal Services 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.
Operational resilience
– The operational resilience strategy of TianYu Eco-Environment comprises – understanding the underlying the factors in the Personal Services 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.
Effective Research and Development (R&D)
– TianYu Eco-Environment has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – TianYu Eco-Environment staying ahead in the Personal Services 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
– TianYu Eco-Environment is one of the leading players in the Personal Services 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.
Highly skilled collaborators
– TianYu Eco-Environment has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Personal Services industry. Secondly the value chain collaborators of TianYu Eco-Environment have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- TianYu Eco-Environment 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 TianYu Eco-Environment is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at TianYu Eco-Environment emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– TianYu Eco-Environment is one of the most innovative firm in Personal Services sector.
Weaknesses of TianYu Eco-Environment | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TianYu Eco-Environment are -
Increasing silos among functional specialists
– The organizational structure of TianYu Eco-Environment is dominated by functional specialists. It is not different from other players in the Personal Services industry, but TianYu Eco-Environment needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help TianYu Eco-Environment to focus more on services in the Personal Services industry rather than just following the product oriented approach.
Need for greater diversity
– TianYu Eco-Environment 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
TianYu Eco-Environment has a high cash cycle compare to other players in the Personal Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– From the outside it seems that TianYu Eco-Environment needs to have more collaboration between its sales team and marketing team. Sales professionals in the Personal Services industry have deep experience in developing customer relationships. Marketing department at TianYu Eco-Environment can leverage the sales team experience to cultivate customer relationships as TianYu Eco-Environment is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of China, TianYu Eco-Environment needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As TianYu Eco-Environment is one of the leading players in the Personal Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Personal Services industry in last five years.
Capital Spending Reduction
– Even during the low interest decade, TianYu Eco-Environment 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 Personal Services industry using digital technology.
Compensation and incentives
– The revenue per employee of TianYu Eco-Environment is just above the Personal Services 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.
Workers concerns about automation
– As automation is fast increasing in the Personal Services industry, TianYu Eco-Environment needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on TianYu Eco-Environment ‘s star products
– The top 2 products and services of TianYu Eco-Environment still accounts for major business revenue. This dependence on star products in Personal Services industry has resulted into insufficient focus on developing new products, even though TianYu Eco-Environment has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, TianYu Eco-Environment has high operating costs in the Personal Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract TianYu Eco-Environment lucrative customers.
TianYu Eco-Environment Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of TianYu Eco-Environment are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Personal Services industry, but it has also influenced the consumer preferences. TianYu Eco-Environment can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– TianYu Eco-Environment has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Personal Services sector. This continuous investment in analytics has enabled TianYu Eco-Environment to build a competitive advantage using analytics. The analytics driven competitive advantage can help TianYu Eco-Environment to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, TianYu Eco-Environment can use these opportunities to build new business models that can help the communities that TianYu Eco-Environment operates in. Secondly it can use opportunities from government spending in Personal Services sector.
Creating value in data economy
– The success of analytics program of TianYu Eco-Environment has opened avenues for new revenue streams for the organization in Personal Services industry. This can help TianYu Eco-Environment to build a more holistic ecosystem for TianYu Eco-Environment products in the Personal Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– TianYu Eco-Environment can develop new processes and procedures in Personal Services 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 TianYu Eco-Environment can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Personal Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. TianYu Eco-Environment 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. TianYu Eco-Environment 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.
Loyalty marketing
– TianYu Eco-Environment 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.
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. TianYu Eco-Environment can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help TianYu Eco-Environment to increase its market reach. TianYu Eco-Environment will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Leveraging digital technologies
– TianYu Eco-Environment 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, TianYu Eco-Environment 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for TianYu Eco-Environment 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 TianYu Eco-Environment to hire the very best people irrespective of their geographical location.
Threats TianYu Eco-Environment External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of TianYu Eco-Environment are -
Shortening product life cycle
– it is one of the major threat that TianYu Eco-Environment is facing in Personal Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, TianYu Eco-Environment 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 TianYu Eco-Environment prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for TianYu Eco-Environment in Personal Services industry. The Personal Services 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.
Stagnating economy with rate increase
– TianYu Eco-Environment 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 Personal Services industry.
Regulatory challenges
– TianYu Eco-Environment 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 Personal Services industry regulations.
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. TianYu Eco-Environment will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
High dependence on third party suppliers
– TianYu Eco-Environment 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.
Consumer confidence and its impact on TianYu Eco-Environment 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 Personal Services industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Personal Services industry are lowering. It can presents TianYu Eco-Environment with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Personal Services sector.
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 TianYu Eco-Environment.
Increasing wage structure of TianYu Eco-Environment
– 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 TianYu Eco-Environment.
Environmental challenges
– TianYu Eco-Environment 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. TianYu Eco-Environment can take advantage of this fund but it will also bring new competitors in the Personal Services 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. TianYu Eco-Environment needs to understand the core reasons impacting the Personal Services industry. This will help it in building a better workplace.
Weighted SWOT Analysis of TianYu Eco-Environment Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at TianYu Eco-Environment 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 TianYu Eco-Environment 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 TianYu Eco-Environment 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 TianYu Eco-Environment 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 TianYu Eco-Environment needs to make to build a sustainable competitive advantage.
