SWOT Analysis / TOWS Matrix for Jiangsu Gaoke Petrochemical (China)
Based on various researches at Oak Spring University , Jiangsu Gaoke Petrochemical is operating in a macro-environment that has been destablized by – geopolitical disruptions, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, increasing energy prices,
customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Jiangsu Gaoke Petrochemical
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jiangsu Gaoke Petrochemical can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jiangsu Gaoke Petrochemical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jiangsu Gaoke Petrochemical 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 Gaoke Petrochemical can be done for the following purposes –
1. Strategic planning of Jiangsu Gaoke Petrochemical
2. Improving business portfolio management of Jiangsu Gaoke Petrochemical
3. Assessing feasibility of the new initiative in China
4. Making a Oil & Gas Operations sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jiangsu Gaoke Petrochemical
Strengths of Jiangsu Gaoke Petrochemical | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jiangsu Gaoke Petrochemical are -
Operational resilience
– The operational resilience strategy of Jiangsu Gaoke Petrochemical comprises – understanding the underlying the factors in the Oil & Gas Operations industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- Jiangsu Gaoke Petrochemical 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 Jiangsu Gaoke Petrochemical is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Jiangsu Gaoke Petrochemical emphasize – knowledge, initiative, and innovation.
Ability to lead change in Oil & Gas Operations
– Jiangsu Gaoke Petrochemical is one of the leading players in the Oil & Gas Operations industry in China. Over the years it has not only transformed the business landscape in the Oil & Gas Operations industry in China but also across the existing markets. The ability to lead change has enabled Jiangsu Gaoke Petrochemical in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Jiangsu Gaoke Petrochemical has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jiangsu Gaoke Petrochemical to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Jiangsu Gaoke Petrochemical 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.
Digital Transformation in Oil & Gas Operations industry
- digital transformation varies from industry to industry. For Jiangsu Gaoke Petrochemical digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jiangsu Gaoke Petrochemical 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 Jiangsu Gaoke Petrochemical in Oil & Gas Operations industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Jiangsu Gaoke Petrochemical is one of the leading players in the Oil & Gas Operations 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 Jiangsu Gaoke Petrochemical in the Energy sector have low bargaining power. Jiangsu Gaoke Petrochemical has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jiangsu Gaoke Petrochemical to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Jiangsu Gaoke Petrochemical is one of the most innovative firm in Oil & Gas Operations sector.
Highly skilled collaborators
– Jiangsu Gaoke Petrochemical has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Oil & Gas Operations industry. Secondly the value chain collaborators of Jiangsu Gaoke Petrochemical have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the Oil & Gas Operations industry
– Jiangsu Gaoke Petrochemical is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Jiangsu Gaoke Petrochemical | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jiangsu Gaoke Petrochemical are -
Compensation and incentives
– The revenue per employee of Jiangsu Gaoke Petrochemical is just above the Oil & Gas Operations 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.
Slow to strategic competitive environment developments
– As Jiangsu Gaoke Petrochemical is one of the leading players in the Oil & Gas Operations industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Oil & Gas Operations industry in last five years.
High bargaining power of channel partners in Oil & Gas Operations industry
– because of the regulatory requirements in China, Jiangsu Gaoke Petrochemical 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 Oil & Gas Operations industry.
Products dominated business model
– Even though Jiangsu Gaoke Petrochemical has some of the most successful models in the Oil & Gas Operations industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Jiangsu Gaoke Petrochemical should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Jiangsu Gaoke Petrochemical 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 Oil & Gas Operations industry using digital technology.
Need for greater diversity
– Jiangsu Gaoke Petrochemical has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High 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 Jiangsu Gaoke Petrochemical supply chain. Even after few cautionary changes, Jiangsu Gaoke Petrochemical is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jiangsu Gaoke Petrochemical vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Jiangsu Gaoke Petrochemical has high operating costs in the Oil & Gas Operations industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Jiangsu Gaoke Petrochemical lucrative customers.
No frontier risks strategy
– From the 10K / annual statement of Jiangsu Gaoke Petrochemical, it seems that company is thinking out the frontier risks that can impact Oil & Gas Operations 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.
Ability to respond to the competition
– As the decision making is very deliberative at Jiangsu Gaoke Petrochemical, in the dynamic environment of Oil & Gas Operations industry it has struggled to respond to the nimble upstart competition. Jiangsu Gaoke Petrochemical has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ less understanding of Jiangsu Gaoke Petrochemical strategy
– From the outside it seems that the employees of Jiangsu Gaoke Petrochemical 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.
Jiangsu Gaoke Petrochemical Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jiangsu Gaoke Petrochemical are -
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 Gaoke Petrochemical can use these opportunities to build new business models that can help the communities that Jiangsu Gaoke Petrochemical operates in. Secondly it can use opportunities from government spending in Oil & Gas Operations sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jiangsu Gaoke Petrochemical 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 Gaoke Petrochemical 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 Jiangsu Gaoke Petrochemical 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 Gaoke Petrochemical can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Jiangsu Gaoke Petrochemical 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 Oil & Gas Operations industry.
Creating value in data economy
– The success of analytics program of Jiangsu Gaoke Petrochemical has opened avenues for new revenue streams for the organization in Oil & Gas Operations industry. This can help Jiangsu Gaoke Petrochemical to build a more holistic ecosystem for Jiangsu Gaoke Petrochemical products in the Oil & Gas Operations industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions in Oil & Gas Operations industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Jiangsu Gaoke Petrochemical in the Oil & Gas Operations industry. Now Jiangsu Gaoke Petrochemical can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Jiangsu Gaoke Petrochemical 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.
Buying journey improvements
– Jiangsu Gaoke Petrochemical can improve the customer journey of consumers in the Oil & Gas Operations 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.
Loyalty marketing
– Jiangsu Gaoke Petrochemical 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.
Developing new processes and practices
– Jiangsu Gaoke Petrochemical can develop new processes and procedures in Oil & Gas Operations 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.
Manufacturing automation
– Jiangsu Gaoke Petrochemical can use the latest technology developments to improve its manufacturing and designing process in Oil & Gas Operations 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.
Learning at scale
– Online learning technologies has now opened space for Jiangsu Gaoke Petrochemical 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.
Threats Jiangsu Gaoke Petrochemical External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jiangsu Gaoke Petrochemical are -
Stagnating economy with rate increase
– Jiangsu Gaoke Petrochemical 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 Oil & Gas Operations industry.
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 Jiangsu Gaoke Petrochemical business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jiangsu Gaoke Petrochemical 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 Gaoke Petrochemical 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 Jiangsu Gaoke Petrochemical in the Oil & Gas Operations sector and impact the bottomline of the organization.
Increasing wage structure of Jiangsu Gaoke Petrochemical
– 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 Gaoke Petrochemical.
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 Gaoke Petrochemical.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jiangsu Gaoke Petrochemical in Oil & Gas Operations industry. The Oil & Gas Operations 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.
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 Gaoke Petrochemical needs to understand the core reasons impacting the Oil & Gas Operations industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Oil & Gas Operations industry are lowering. It can presents Jiangsu Gaoke Petrochemical with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Oil & Gas Operations sector.
Technology acceleration in Forth Industrial Revolution
– Jiangsu Gaoke Petrochemical has witnessed rapid integration of technology during Covid-19 in the Oil & Gas Operations industry. As one of the leading players in the industry, Jiangsu Gaoke Petrochemical needs to keep up with the evolution of technology in the Oil & Gas Operations 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.
Regulatory challenges
– Jiangsu Gaoke Petrochemical 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 Oil & Gas Operations industry regulations.
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.
Consumer confidence and its impact on Jiangsu Gaoke Petrochemical 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 Oil & Gas Operations industry and other sectors.
Weighted SWOT Analysis of Jiangsu Gaoke Petrochemical Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jiangsu Gaoke Petrochemical 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 Gaoke Petrochemical 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 Gaoke Petrochemical 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 Gaoke Petrochemical 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 Gaoke Petrochemical needs to make to build a sustainable competitive advantage.