Metallurgical Corp China (1618) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Metallurgical Corp China (Hong Kong)

Based on various researches at Oak Spring University , Metallurgical Corp China is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, etc

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Introduction to SWOT Analysis of Metallurgical Corp China

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Metallurgical Corp China can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Metallurgical Corp China, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Metallurgical Corp China 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Metallurgical Corp China can be done for the following purposes –
1. Strategic planning of Metallurgical Corp China
2. Improving business portfolio management of Metallurgical Corp China
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Metallurgical Corp China

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Strengths of Metallurgical Corp China | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Metallurgical Corp China are -

Ability to lead change in Construction Services

– Metallurgical Corp China is one of the leading players in the Construction Services industry in Hong Kong. Over the years it has not only transformed the business landscape in the Construction Services industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Metallurgical Corp China in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Ability to recruit top talent

– Metallurgical Corp China is one of the leading players in the Construction Services industry in Hong Kong. It is in a position to attract the best talent available in Hong Kong. The firm has a robust talent identification program that helps in identifying the brightest.

Innovation driven organization

– Metallurgical Corp China is one of the most innovative firm in Construction Services sector.

Cross disciplinary teams

– Horizontal connected teams at the Metallurgical Corp China 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.

Superior customer experience

– The customer experience strategy of Metallurgical Corp China in Construction Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Successful track record of launching new products

– Metallurgical Corp China has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Metallurgical Corp China 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.

Low bargaining power of suppliers

– Suppliers of Metallurgical Corp China in the Capital Goods sector have low bargaining power. Metallurgical Corp China has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Metallurgical Corp China to manage not only supply disruptions but also source products at highly competitive prices.

Strong track record of project management in the Construction Services industry

– Metallurgical Corp China 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

– Metallurgical Corp China has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Metallurgical Corp China to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Learning organization

- Metallurgical Corp China 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 Metallurgical Corp China is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Metallurgical Corp China emphasize – knowledge, initiative, and innovation.

High switching costs

– The high switching costs that Metallurgical Corp China 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)

– Metallurgical Corp China has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Metallurgical Corp China staying ahead in the Construction Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

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Weaknesses of Metallurgical Corp China | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Metallurgical Corp China are -

Slow decision making process

– As mentioned earlier in the report, Metallurgical Corp China has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Construction Services industry over the last five years. Metallurgical Corp China 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.

Need for greater diversity

– Metallurgical Corp China 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.

Capital Spending Reduction

– Even during the low interest decade, Metallurgical Corp China 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 Construction Services industry using digital technology.

Increasing silos among functional specialists

– The organizational structure of Metallurgical Corp China is dominated by functional specialists. It is not different from other players in the Construction Services industry, but Metallurgical Corp China needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Metallurgical Corp China to focus more on services in the Construction Services industry rather than just following the product oriented approach.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Metallurgical Corp China is slow explore the new channels of communication. These new channels of communication can help Metallurgical Corp China to provide better information regarding Construction Services products and services. It can also build an online community to further reach out to potential customers.

Products dominated business model

– Even though Metallurgical Corp China has some of the most successful models in the Construction Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Metallurgical Corp China should strive to include more intangible value offerings along with its core products and services.

Interest costs

– Compare to the competition, Metallurgical Corp China 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.

High bargaining power of channel partners in Construction Services industry

– because of the regulatory requirements in Hong Kong, Metallurgical Corp China 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 Construction Services industry.

Workers concerns about automation

– As automation is fast increasing in the Construction Services industry, Metallurgical Corp China needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.

High dependence on Metallurgical Corp China ‘s star products

– The top 2 products and services of Metallurgical Corp China still accounts for major business revenue. This dependence on star products in Construction Services industry has resulted into insufficient focus on developing new products, even though Metallurgical Corp China has relatively successful track record of launching new products.

Lack of clear differentiation of Metallurgical Corp China products

– To increase the profitability and margins on the products, Metallurgical Corp China needs to provide more differentiated products than what it is currently offering in the marketplace.

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Metallurgical Corp China Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Metallurgical Corp China are -

Using analytics as competitive advantage

– Metallurgical Corp China has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Construction Services sector. This continuous investment in analytics has enabled Metallurgical Corp China to build a competitive advantage using analytics. The analytics driven competitive advantage can help Metallurgical Corp China to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Creating value in data economy

– The success of analytics program of Metallurgical Corp China has opened avenues for new revenue streams for the organization in Construction Services industry. This can help Metallurgical Corp China to build a more holistic ecosystem for Metallurgical Corp China products in the Construction Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Leveraging digital technologies

– Metallurgical Corp China 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.

Better consumer reach

– The expansion of the 5G network will help Metallurgical Corp China to increase its market reach. Metallurgical Corp China 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.

Manufacturing automation

– Metallurgical Corp China can use the latest technology developments to improve its manufacturing and designing process in Construction Services 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Metallurgical Corp China 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 Metallurgical Corp China to hire the very best people irrespective of their geographical location.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Metallurgical Corp China is facing challenges because of the dominance of functional experts in the organization. Metallurgical Corp China can utilize new technology in the field of Construction Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Metallurgical Corp China in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Construction Services industry, and it will provide faster access to the consumers.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Metallurgical Corp China can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Low interest rates

– Even though inflation is raising its head in most developed economies, Metallurgical Corp China 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.

Learning at scale

– Online learning technologies has now opened space for Metallurgical Corp China 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Metallurgical Corp China 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 Metallurgical Corp China to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Construction Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Metallurgical Corp China 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. Metallurgical Corp China 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.

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Threats Metallurgical Corp China External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Metallurgical Corp China are -

Environmental challenges

– Metallurgical Corp China 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. Metallurgical Corp China can take advantage of this fund but it will also bring new competitors in the Construction Services industry.

High dependence on third party suppliers

– Metallurgical Corp China 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.

Increasing wage structure of Metallurgical Corp China

– 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 Metallurgical Corp China.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Metallurgical Corp China 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 Metallurgical Corp China prominent markets.

Easy access to finance

– Easy access to finance in Construction Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Metallurgical Corp China 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.

Regulatory challenges

– Metallurgical Corp China 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 Construction Services industry regulations.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Construction Services industry are lowering. It can presents Metallurgical Corp China with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Construction Services sector.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Metallurgical Corp China in Construction Services industry. The Construction 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.

Technology acceleration in Forth Industrial Revolution

– Metallurgical Corp China has witnessed rapid integration of technology during Covid-19 in the Construction Services industry. As one of the leading players in the industry, Metallurgical Corp China needs to keep up with the evolution of technology in the Construction 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.

Shortening product life cycle

– it is one of the major threat that Metallurgical Corp China is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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.

Stagnating economy with rate increase

– Metallurgical Corp China 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 Construction Services industry.

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Weighted SWOT Analysis of Metallurgical Corp China Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Metallurgical Corp China 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 Metallurgical Corp China 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 Metallurgical Corp China 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 Metallurgical Corp China 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 Metallurgical Corp China needs to make to build a sustainable competitive advantage.

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