SWOT Analysis / TOWS Matrix for Jiangsu Xinri E-Vehicle (China)
Based on various researches at Oak Spring University , Jiangsu Xinri E-Vehicle is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, wage bills are increasing, increasing energy prices, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , increasing commodity prices,
technology disruption, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Jiangsu Xinri E-Vehicle
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jiangsu Xinri E-Vehicle can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jiangsu Xinri E-Vehicle, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle can be done for the following purposes –
1. Strategic planning of Jiangsu Xinri E-Vehicle
2. Improving business portfolio management of Jiangsu Xinri E-Vehicle
3. Assessing feasibility of the new initiative in China
4. Making a Recreational Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jiangsu Xinri E-Vehicle
Strengths of Jiangsu Xinri E-Vehicle | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jiangsu Xinri E-Vehicle are -
Diverse revenue streams
– Jiangsu Xinri E-Vehicle is present in almost all the verticals within the Recreational Products industry. This has provided Jiangsu Xinri E-Vehicle 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.
Low bargaining power of suppliers
– Suppliers of Jiangsu Xinri E-Vehicle in the Consumer Cyclical sector have low bargaining power. Jiangsu Xinri E-Vehicle has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jiangsu Xinri E-Vehicle to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Jiangsu Xinri E-Vehicle has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Recreational Products industry. Secondly the value chain collaborators of Jiangsu Xinri E-Vehicle have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Jiangsu Xinri E-Vehicle has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Jiangsu Xinri E-Vehicle staying ahead in the Recreational Products industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Jiangsu Xinri E-Vehicle has one of the best training and development program in Consumer Cyclical 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.
Organizational Resilience of Jiangsu Xinri E-Vehicle
– The covid-19 pandemic has put organizational resilience at the centre of everthing Jiangsu Xinri E-Vehicle does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management in the Recreational Products industry
– Jiangsu Xinri E-Vehicle is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Jiangsu Xinri E-Vehicle has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Successful track record of launching new products
– Jiangsu Xinri E-Vehicle has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jiangsu Xinri E-Vehicle 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.
Cross disciplinary teams
– Horizontal connected teams at the Jiangsu Xinri E-Vehicle 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.
Analytics focus
– Jiangsu Xinri E-Vehicle 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 Recreational Products 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
– Jiangsu Xinri E-Vehicle has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jiangsu Xinri E-Vehicle to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Jiangsu Xinri E-Vehicle | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jiangsu Xinri E-Vehicle are -
Workers concerns about automation
– As automation is fast increasing in the Recreational Products industry, Jiangsu Xinri E-Vehicle 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 cash cycle compare to competitors
Jiangsu Xinri E-Vehicle has a high cash cycle compare to other players in the Recreational Products industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– From the 10K / annual statement of Jiangsu Xinri E-Vehicle, it seems that company is thinking out the frontier risks that can impact Recreational Products 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, Jiangsu Xinri E-Vehicle has high operating costs in the Recreational Products industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Jiangsu Xinri E-Vehicle lucrative customers.
Employees’ less understanding of Jiangsu Xinri E-Vehicle strategy
– From the outside it seems that the employees of Jiangsu Xinri E-Vehicle don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Jiangsu Xinri E-Vehicle is slow explore the new channels of communication. These new channels of communication can help Jiangsu Xinri E-Vehicle to provide better information regarding Recreational Products products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Jiangsu Xinri E-Vehicle is one of the leading players in the Recreational Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Recreational Products industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative at Jiangsu Xinri E-Vehicle, in the dynamic environment of Recreational Products industry it has struggled to respond to the nimble upstart competition. Jiangsu Xinri E-Vehicle has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring in Recreational Products industry
– The stress on hiring functional specialists at Jiangsu Xinri E-Vehicle 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.
Lack of clear differentiation of Jiangsu Xinri E-Vehicle products
– To increase the profitability and margins on the products, Jiangsu Xinri E-Vehicle needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Jiangsu Xinri E-Vehicle is just above the Recreational Products 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.
Jiangsu Xinri E-Vehicle Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jiangsu Xinri E-Vehicle are -
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 Jiangsu Xinri E-Vehicle 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jiangsu Xinri E-Vehicle can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jiangsu Xinri E-Vehicle is facing challenges because of the dominance of functional experts in the organization. Jiangsu Xinri E-Vehicle can utilize new technology in the field of Recreational Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Recreational Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Jiangsu Xinri E-Vehicle in the Recreational Products industry. Now Jiangsu Xinri E-Vehicle can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Jiangsu Xinri E-Vehicle 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Jiangsu Xinri E-Vehicle 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.
Leveraging digital technologies
– Jiangsu Xinri E-Vehicle 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jiangsu Xinri E-Vehicle can use these opportunities to build new business models that can help the communities that Jiangsu Xinri E-Vehicle operates in. Secondly it can use opportunities from government spending in Recreational Products sector.
Better consumer reach
– The expansion of the 5G network will help Jiangsu Xinri E-Vehicle to increase its market reach. Jiangsu Xinri E-Vehicle 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Recreational Products industry, but it has also influenced the consumer preferences. Jiangsu Xinri E-Vehicle can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Jiangsu Xinri E-Vehicle can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Jiangsu Xinri E-Vehicle External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jiangsu Xinri E-Vehicle are -
Increasing wage structure of Jiangsu Xinri E-Vehicle
– 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 Jiangsu Xinri E-Vehicle.
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.
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. Jiangsu Xinri E-Vehicle needs to understand the core reasons impacting the Recreational Products industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Recreational Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Jiangsu Xinri E-Vehicle can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Jiangsu Xinri E-Vehicle 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.
Stagnating economy with rate increase
– Jiangsu Xinri E-Vehicle 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 Recreational Products industry.
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 Jiangsu Xinri E-Vehicle.
Environmental challenges
– Jiangsu Xinri E-Vehicle 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. Jiangsu Xinri E-Vehicle can take advantage of this fund but it will also bring new competitors in the Recreational Products industry.
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.
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 Jiangsu Xinri E-Vehicle in the Recreational Products sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Recreational Products industry are lowering. It can presents Jiangsu Xinri E-Vehicle with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Recreational Products sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle prominent markets.
Technology acceleration in Forth Industrial Revolution
– Jiangsu Xinri E-Vehicle has witnessed rapid integration of technology during Covid-19 in the Recreational Products industry. As one of the leading players in the industry, Jiangsu Xinri E-Vehicle needs to keep up with the evolution of technology in the Recreational Products 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.
Weighted SWOT Analysis of Jiangsu Xinri E-Vehicle Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle 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 Jiangsu Xinri E-Vehicle needs to make to build a sustainable competitive advantage.