SWOT Analysis / TOWS Matrix for Shanghai Vohringer Wood (China)
Based on various researches at Oak Spring University , Shanghai Vohringer Wood is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, there is backlash against globalization, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, increasing energy prices,
increasing commodity prices, geopolitical disruptions, etc
Introduction to SWOT Analysis of Shanghai Vohringer Wood
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shanghai Vohringer Wood can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shanghai Vohringer Wood, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shanghai Vohringer Wood 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 Shanghai Vohringer Wood can be done for the following purposes –
1. Strategic planning of Shanghai Vohringer Wood
2. Improving business portfolio management of Shanghai Vohringer Wood
3. Assessing feasibility of the new initiative in China
4. Making a Forestry & Wood Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shanghai Vohringer Wood
Strengths of Shanghai Vohringer Wood | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shanghai Vohringer Wood are -
Successful track record of launching new products
– Shanghai Vohringer Wood has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Shanghai Vohringer Wood 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.
Organizational Resilience of Shanghai Vohringer Wood
– The covid-19 pandemic has put organizational resilience at the centre of everthing Shanghai Vohringer Wood does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Shanghai Vohringer Wood in Forestry & Wood Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Shanghai Vohringer Wood 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 Shanghai Vohringer Wood is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Shanghai Vohringer Wood emphasize – knowledge, initiative, and innovation.
Ability to lead change in Forestry & Wood Products
– Shanghai Vohringer Wood is one of the leading players in the Forestry & Wood Products industry in China. Over the years it has not only transformed the business landscape in the Forestry & Wood Products industry in China but also across the existing markets. The ability to lead change has enabled Shanghai Vohringer Wood in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Shanghai Vohringer Wood is one of the most innovative firm in Forestry & Wood Products sector.
High brand equity
– Shanghai Vohringer Wood has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Shanghai Vohringer Wood to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Forestry & Wood Products industry
– Shanghai Vohringer Wood has clearly differentiated products in the market place. This has enabled Shanghai Vohringer Wood to fetch slight price premium compare to the competitors in the Forestry & Wood Products industry. The sustainable margins have also helped Shanghai Vohringer Wood to invest into research and development (R&D) and innovation.
Digital Transformation in Forestry & Wood Products industry
- digital transformation varies from industry to industry. For Shanghai Vohringer Wood digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shanghai Vohringer Wood 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.
Ability to recruit top talent
– Shanghai Vohringer Wood is one of the leading players in the Forestry & Wood Products 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.
Training and development
– Shanghai Vohringer Wood has one of the best training and development program in Basic Materials industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Shanghai Vohringer Wood 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.
Weaknesses of Shanghai Vohringer Wood | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shanghai Vohringer Wood are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shanghai Vohringer Wood is slow explore the new channels of communication. These new channels of communication can help Shanghai Vohringer Wood to provide better information regarding Forestry & Wood Products 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 Shanghai Vohringer Wood supply chain. Even after few cautionary changes, Shanghai Vohringer Wood is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Shanghai Vohringer Wood vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Shanghai Vohringer Wood is dominated by functional specialists. It is not different from other players in the Forestry & Wood Products industry, but Shanghai Vohringer Wood needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shanghai Vohringer Wood to focus more on services in the Forestry & Wood Products industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, Shanghai Vohringer Wood has high operating costs in the Forestry & Wood Products industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Shanghai Vohringer Wood lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative at Shanghai Vohringer Wood, in the dynamic environment of Forestry & Wood Products industry it has struggled to respond to the nimble upstart competition. Shanghai Vohringer Wood 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, Shanghai Vohringer Wood needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Shanghai Vohringer Wood ‘s star products
– The top 2 products and services of Shanghai Vohringer Wood still accounts for major business revenue. This dependence on star products in Forestry & Wood Products industry has resulted into insufficient focus on developing new products, even though Shanghai Vohringer Wood has relatively successful track record of launching new products.
Skills based hiring in Forestry & Wood Products industry
– The stress on hiring functional specialists at Shanghai Vohringer Wood 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.
High cash cycle compare to competitors
Shanghai Vohringer Wood has a high cash cycle compare to other players in the Forestry & Wood 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.
Employees’ less understanding of Shanghai Vohringer Wood strategy
– From the outside it seems that the employees of Shanghai Vohringer Wood 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.
Capital Spending Reduction
– Even during the low interest decade, Shanghai Vohringer Wood 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 Forestry & Wood Products industry using digital technology.
Shanghai Vohringer Wood Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Shanghai Vohringer Wood are -
Creating value in data economy
– The success of analytics program of Shanghai Vohringer Wood has opened avenues for new revenue streams for the organization in Forestry & Wood Products industry. This can help Shanghai Vohringer Wood to build a more holistic ecosystem for Shanghai Vohringer Wood products in the Forestry & Wood Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Shanghai Vohringer Wood 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 Forestry & Wood Products industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Shanghai Vohringer Wood can use these opportunities to build new business models that can help the communities that Shanghai Vohringer Wood operates in. Secondly it can use opportunities from government spending in Forestry & Wood Products sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Forestry & Wood Products industry, but it has also influenced the consumer preferences. Shanghai Vohringer Wood can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Forestry & Wood Products industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Shanghai Vohringer Wood 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. Shanghai Vohringer Wood 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shanghai Vohringer Wood in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Forestry & Wood Products industry, and it will provide faster access to the consumers.
Buying journey improvements
– Shanghai Vohringer Wood can improve the customer journey of consumers in the Forestry & Wood Products 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Shanghai Vohringer Wood 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 Shanghai Vohringer Wood to hire the very best people irrespective of their geographical location.
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 Shanghai Vohringer Wood 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.
Using analytics as competitive advantage
– Shanghai Vohringer Wood has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Forestry & Wood Products sector. This continuous investment in analytics has enabled Shanghai Vohringer Wood to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shanghai Vohringer Wood to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Shanghai Vohringer Wood can use the latest technology developments to improve its manufacturing and designing process in Forestry & Wood Products 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.
Use of Bitcoin and other crypto currencies for transactions in Forestry & Wood Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Shanghai Vohringer Wood in the Forestry & Wood Products industry. Now Shanghai Vohringer Wood can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Shanghai Vohringer Wood 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.
Threats Shanghai Vohringer Wood External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Shanghai Vohringer Wood are -
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. Shanghai Vohringer Wood 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Shanghai Vohringer Wood 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 Shanghai Vohringer Wood prominent markets.
Stagnating economy with rate increase
– Shanghai Vohringer Wood 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 Forestry & Wood 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.
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. Shanghai Vohringer Wood needs to understand the core reasons impacting the Forestry & Wood Products industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Shanghai Vohringer Wood 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.
Technology acceleration in Forth Industrial Revolution
– Shanghai Vohringer Wood has witnessed rapid integration of technology during Covid-19 in the Forestry & Wood Products industry. As one of the leading players in the industry, Shanghai Vohringer Wood needs to keep up with the evolution of technology in the Forestry & Wood 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Shanghai Vohringer Wood may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Forestry & Wood Products sector.
Environmental challenges
– Shanghai Vohringer Wood 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. Shanghai Vohringer Wood can take advantage of this fund but it will also bring new competitors in the Forestry & Wood Products industry.
Consumer confidence and its impact on Shanghai Vohringer Wood 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 Forestry & Wood Products industry and other sectors.
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.
Easy access to finance
– Easy access to finance in Forestry & Wood Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Shanghai Vohringer Wood can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Shanghai Vohringer Wood.
Weighted SWOT Analysis of Shanghai Vohringer Wood Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shanghai Vohringer Wood 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 Shanghai Vohringer Wood 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 Shanghai Vohringer Wood 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 Shanghai Vohringer Wood 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 Shanghai Vohringer Wood needs to make to build a sustainable competitive advantage.
