SWOT Analysis / TOWS Matrix for Hainan Shuangcheng Pharmaceut (China)
Based on various researches at Oak Spring University , Hainan Shuangcheng Pharmaceut is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies,
there is backlash against globalization, wage bills are increasing, etc
Introduction to SWOT Analysis of Hainan Shuangcheng Pharmaceut
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hainan Shuangcheng Pharmaceut can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hainan Shuangcheng Pharmaceut, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut can be done for the following purposes –
1. Strategic planning of Hainan Shuangcheng Pharmaceut
2. Improving business portfolio management of Hainan Shuangcheng Pharmaceut
3. Assessing feasibility of the new initiative in China
4. Making a Major Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hainan Shuangcheng Pharmaceut
Strengths of Hainan Shuangcheng Pharmaceut | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hainan Shuangcheng Pharmaceut are -
Innovation driven organization
– Hainan Shuangcheng Pharmaceut is one of the most innovative firm in Major Drugs sector.
Ability to recruit top talent
– Hainan Shuangcheng Pharmaceut is one of the leading players in the Major Drugs industry in China. It is in a position to attract the best talent available in China. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Hainan Shuangcheng Pharmaceut in the Healthcare sector have low bargaining power. Hainan Shuangcheng Pharmaceut has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hainan Shuangcheng Pharmaceut to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hainan Shuangcheng Pharmaceut emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Hainan Shuangcheng Pharmaceut has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hainan Shuangcheng Pharmaceut 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.
High switching costs
– The high switching costs that Hainan Shuangcheng Pharmaceut 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.
Effective Research and Development (R&D)
– Hainan Shuangcheng Pharmaceut has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Hainan Shuangcheng Pharmaceut staying ahead in the Major Drugs industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Major Drugs industry
– Hainan Shuangcheng Pharmaceut has clearly differentiated products in the market place. This has enabled Hainan Shuangcheng Pharmaceut to fetch slight price premium compare to the competitors in the Major Drugs industry. The sustainable margins have also helped Hainan Shuangcheng Pharmaceut to invest into research and development (R&D) and innovation.
Ability to lead change in Major Drugs
– Hainan Shuangcheng Pharmaceut is one of the leading players in the Major Drugs industry in China. Over the years it has not only transformed the business landscape in the Major Drugs industry in China but also across the existing markets. The ability to lead change has enabled Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut in Major Drugs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Hainan Shuangcheng Pharmaceut has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Major Drugs industry. Secondly the value chain collaborators of Hainan Shuangcheng Pharmaceut have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Hainan Shuangcheng Pharmaceut 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 Major Drugs 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.
Weaknesses of Hainan Shuangcheng Pharmaceut | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hainan Shuangcheng Pharmaceut are -
Lack of clear differentiation of Hainan Shuangcheng Pharmaceut products
– To increase the profitability and margins on the products, Hainan Shuangcheng Pharmaceut needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the Major Drugs industry, Hainan Shuangcheng Pharmaceut 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.
Compensation and incentives
– The revenue per employee of Hainan Shuangcheng Pharmaceut is just above the Major Drugs 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 cash cycle compare to competitors
Hainan Shuangcheng Pharmaceut has a high cash cycle compare to other players in the Major Drugs industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, Hainan Shuangcheng Pharmaceut has high operating costs in the Major Drugs industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Hainan Shuangcheng Pharmaceut lucrative customers.
Skills based hiring in Major Drugs industry
– The stress on hiring functional specialists at Hainan Shuangcheng Pharmaceut has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Low market penetration in new markets
– Outside its home market of China, Hainan Shuangcheng Pharmaceut needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Hainan Shuangcheng Pharmaceut has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Capital Spending Reduction
– Even during the low interest decade, Hainan Shuangcheng Pharmaceut 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 Major Drugs industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Hainan Shuangcheng Pharmaceut is dominated by functional specialists. It is not different from other players in the Major Drugs industry, but Hainan Shuangcheng Pharmaceut needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hainan Shuangcheng Pharmaceut to focus more on services in the Major Drugs industry rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Hainan Shuangcheng Pharmaceut has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Major Drugs industry over the last five years. Hainan Shuangcheng Pharmaceut even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Hainan Shuangcheng Pharmaceut Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hainan Shuangcheng Pharmaceut are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Hainan Shuangcheng Pharmaceut 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.
Loyalty marketing
– Hainan Shuangcheng Pharmaceut 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.
Learning at scale
– Online learning technologies has now opened space for Hainan Shuangcheng Pharmaceut 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.
Building a culture of innovation
– managers at Hainan Shuangcheng Pharmaceut 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 Major Drugs industry.
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. Hainan Shuangcheng Pharmaceut can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hainan Shuangcheng Pharmaceut can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Better consumer reach
– The expansion of the 5G network will help Hainan Shuangcheng Pharmaceut to increase its market reach. Hainan Shuangcheng Pharmaceut 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hainan Shuangcheng Pharmaceut is facing challenges because of the dominance of functional experts in the organization. Hainan Shuangcheng Pharmaceut can utilize new technology in the field of Major Drugs industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Hainan Shuangcheng Pharmaceut can develop new processes and procedures in Major Drugs 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.
Creating value in data economy
– The success of analytics program of Hainan Shuangcheng Pharmaceut has opened avenues for new revenue streams for the organization in Major Drugs industry. This can help Hainan Shuangcheng Pharmaceut to build a more holistic ecosystem for Hainan Shuangcheng Pharmaceut products in the Major Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Hainan Shuangcheng Pharmaceut 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.
Threats Hainan Shuangcheng Pharmaceut External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hainan Shuangcheng Pharmaceut are -
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Hainan Shuangcheng Pharmaceut business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Major Drugs industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hainan Shuangcheng Pharmaceut can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Hainan Shuangcheng Pharmaceut may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Major Drugs sector.
Stagnating economy with rate increase
– Hainan Shuangcheng Pharmaceut 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 Major Drugs industry.
Regulatory challenges
– Hainan Shuangcheng Pharmaceut 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 Major Drugs industry regulations.
Environmental challenges
– Hainan Shuangcheng Pharmaceut 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. Hainan Shuangcheng Pharmaceut can take advantage of this fund but it will also bring new competitors in the Major Drugs industry.
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. Hainan Shuangcheng Pharmaceut 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.
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 Hainan Shuangcheng Pharmaceut in the Major Drugs sector and impact the bottomline of the organization.
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 Hainan Shuangcheng Pharmaceut.
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 dependence on third party suppliers
– Hainan Shuangcheng Pharmaceut 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.
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
– Hainan Shuangcheng Pharmaceut has witnessed rapid integration of technology during Covid-19 in the Major Drugs industry. As one of the leading players in the industry, Hainan Shuangcheng Pharmaceut needs to keep up with the evolution of technology in the Major Drugs 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 Hainan Shuangcheng Pharmaceut Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut 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 Hainan Shuangcheng Pharmaceut needs to make to build a sustainable competitive advantage.