SWOT Analysis / TOWS Matrix for Hangzhou Huaxing Chuangye (China)
Based on various researches at Oak Spring University , Hangzhou Huaxing Chuangye is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, geopolitical disruptions, talent flight as more people leaving formal jobs, there is backlash against globalization, challanges to central banks by blockchain based private currencies,
central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Hangzhou Huaxing Chuangye
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hangzhou Huaxing Chuangye can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hangzhou Huaxing Chuangye, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye can be done for the following purposes –
1. Strategic planning of Hangzhou Huaxing Chuangye
2. Improving business portfolio management of Hangzhou Huaxing Chuangye
3. Assessing feasibility of the new initiative in China
4. Making a Communications Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hangzhou Huaxing Chuangye
Strengths of Hangzhou Huaxing Chuangye | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hangzhou Huaxing Chuangye are -
Sustainable margins compare to other players in Communications Services industry
– Hangzhou Huaxing Chuangye has clearly differentiated products in the market place. This has enabled Hangzhou Huaxing Chuangye to fetch slight price premium compare to the competitors in the Communications Services industry. The sustainable margins have also helped Hangzhou Huaxing Chuangye to invest into research and development (R&D) and innovation.
Digital Transformation in Communications Services industry
- digital transformation varies from industry to industry. For Hangzhou Huaxing Chuangye digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hangzhou Huaxing Chuangye 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.
Superior customer experience
– The customer experience strategy of Hangzhou Huaxing Chuangye in Communications Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Hangzhou Huaxing Chuangye has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Communications Services industry. Secondly the value chain collaborators of Hangzhou Huaxing Chuangye have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Hangzhou Huaxing Chuangye is one of the most innovative firm in Communications Services sector.
Training and development
– Hangzhou Huaxing Chuangye has one of the best training and development program in Services 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.
Strong track record of project management in the Communications Services industry
– Hangzhou Huaxing Chuangye 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 brand equity
– Hangzhou Huaxing Chuangye has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hangzhou Huaxing Chuangye to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Hangzhou Huaxing Chuangye is one of the leading players in the Communications 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.
Cross disciplinary teams
– Horizontal connected teams at the Hangzhou Huaxing Chuangye 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.
Learning organization
- Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hangzhou Huaxing Chuangye emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Hangzhou Huaxing Chuangye
– The covid-19 pandemic has put organizational resilience at the centre of everthing Hangzhou Huaxing Chuangye does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Hangzhou Huaxing Chuangye | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hangzhou Huaxing Chuangye are -
Capital Spending Reduction
– Even during the low interest decade, Hangzhou Huaxing Chuangye 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 Communications Services industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative at Hangzhou Huaxing Chuangye, in the dynamic environment of Communications Services industry it has struggled to respond to the nimble upstart competition. Hangzhou Huaxing Chuangye has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Hangzhou Huaxing Chuangye supply chain. Even after few cautionary changes, Hangzhou Huaxing Chuangye is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hangzhou Huaxing Chuangye vulnerable to further global disruptions in South East Asia.
High dependence on Hangzhou Huaxing Chuangye ‘s star products
– The top 2 products and services of Hangzhou Huaxing Chuangye still accounts for major business revenue. This dependence on star products in Communications Services industry has resulted into insufficient focus on developing new products, even though Hangzhou Huaxing Chuangye has relatively successful track record of launching new products.
No frontier risks strategy
– From the 10K / annual statement of Hangzhou Huaxing Chuangye, it seems that company is thinking out the frontier risks that can impact Communications Services 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hangzhou Huaxing Chuangye is slow explore the new channels of communication. These new channels of communication can help Hangzhou Huaxing Chuangye to provide better information regarding Communications Services products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee of Hangzhou Huaxing Chuangye is just above the Communications 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.
High bargaining power of channel partners in Communications Services industry
– because of the regulatory requirements in China, Hangzhou Huaxing Chuangye 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 Communications Services industry.
Products dominated business model
– Even though Hangzhou Huaxing Chuangye has some of the most successful models in the Communications Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hangzhou Huaxing Chuangye should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the Communications Services industry, Hangzhou Huaxing Chuangye 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.
Aligning sales with marketing
– From the outside it seems that Hangzhou Huaxing Chuangye needs to have more collaboration between its sales team and marketing team. Sales professionals in the Communications Services industry have deep experience in developing customer relationships. Marketing department at Hangzhou Huaxing Chuangye can leverage the sales team experience to cultivate customer relationships as Hangzhou Huaxing Chuangye is planning to shift buying processes online.
Hangzhou Huaxing Chuangye Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hangzhou Huaxing Chuangye are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Hangzhou Huaxing Chuangye 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Communications Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hangzhou Huaxing Chuangye 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. Hangzhou Huaxing Chuangye 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Hangzhou Huaxing Chuangye 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Hangzhou Huaxing Chuangye can develop new processes and procedures in Communications 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hangzhou Huaxing Chuangye is facing challenges because of the dominance of functional experts in the organization. Hangzhou Huaxing Chuangye can utilize new technology in the field of Communications Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Hangzhou Huaxing Chuangye has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Communications Services sector. This continuous investment in analytics has enabled Hangzhou Huaxing Chuangye to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hangzhou Huaxing Chuangye to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hangzhou Huaxing Chuangye can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Hangzhou Huaxing Chuangye can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hangzhou Huaxing Chuangye in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communications Services industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Communications Services industry, but it has also influenced the consumer preferences. Hangzhou Huaxing Chuangye can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Hangzhou Huaxing Chuangye 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 Communications Services industry.
Threats Hangzhou Huaxing Chuangye External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hangzhou Huaxing Chuangye are -
High dependence on third party suppliers
– Hangzhou Huaxing Chuangye 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 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. Hangzhou Huaxing Chuangye needs to understand the core reasons impacting the Communications Services industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Hangzhou Huaxing Chuangye may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communications Services sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hangzhou Huaxing Chuangye in Communications Services industry. The Communications 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.
Environmental challenges
– Hangzhou Huaxing Chuangye 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. Hangzhou Huaxing Chuangye can take advantage of this fund but it will also bring new competitors in the Communications Services industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye prominent markets.
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 Hangzhou Huaxing Chuangye in the Communications Services sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Communications Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hangzhou Huaxing Chuangye can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Technology acceleration in Forth Industrial Revolution
– Hangzhou Huaxing Chuangye has witnessed rapid integration of technology during Covid-19 in the Communications Services industry. As one of the leading players in the industry, Hangzhou Huaxing Chuangye needs to keep up with the evolution of technology in the Communications Services 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.
Consumer confidence and its impact on Hangzhou Huaxing Chuangye 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 Communications Services industry and other sectors.
Shortening product life cycle
– it is one of the major threat that Hangzhou Huaxing Chuangye is facing in Communications Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Hangzhou Huaxing Chuangye Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye 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 Hangzhou Huaxing Chuangye needs to make to build a sustainable competitive advantage.
