SWOT Analysis / TOWS Matrix for Zhejiang Expressway (Hong Kong)
Based on various researches at Oak Spring University , Zhejiang Expressway is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing transportation and logistics costs, geopolitical disruptions, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , increasing energy prices,
competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, etc
Introduction to SWOT Analysis of Zhejiang Expressway
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Zhejiang Expressway can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Zhejiang Expressway, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Zhejiang Expressway 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 Zhejiang Expressway can be done for the following purposes –
1. Strategic planning of Zhejiang Expressway
2. Improving business portfolio management of Zhejiang Expressway
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Misc. Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Zhejiang Expressway
Strengths of Zhejiang Expressway | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Zhejiang Expressway are -
Training and development
– Zhejiang Expressway has one of the best training and development program in Transportation 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.
Innovation driven organization
– Zhejiang Expressway is one of the most innovative firm in Misc. Transportation sector.
Highly skilled collaborators
– Zhejiang Expressway has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Transportation industry. Secondly the value chain collaborators of Zhejiang Expressway have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Misc. Transportation industry
– Zhejiang Expressway has clearly differentiated products in the market place. This has enabled Zhejiang Expressway to fetch slight price premium compare to the competitors in the Misc. Transportation industry. The sustainable margins have also helped Zhejiang Expressway to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Zhejiang Expressway in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management in the Misc. Transportation industry
– Zhejiang Expressway is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy of Zhejiang Expressway comprises – understanding the underlying the factors in the Misc. Transportation 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.
Organizational Resilience of Zhejiang Expressway
– The covid-19 pandemic has put organizational resilience at the centre of everthing Zhejiang Expressway does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Misc. Transportation industry
- digital transformation varies from industry to industry. For Zhejiang Expressway digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Zhejiang Expressway 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.
Diverse revenue streams
– Zhejiang Expressway is present in almost all the verticals within the Misc. Transportation industry. This has provided Zhejiang Expressway a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to recruit top talent
– Zhejiang Expressway is one of the leading players in the Misc. Transportation 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.
Low bargaining power of suppliers
– Suppliers of Zhejiang Expressway in the Transportation sector have low bargaining power. Zhejiang Expressway has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Zhejiang Expressway to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Zhejiang Expressway | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Zhejiang Expressway are -
Slow decision making process
– As mentioned earlier in the report, Zhejiang Expressway has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Transportation industry over the last five years. Zhejiang Expressway 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.
No frontier risks strategy
– From the 10K / annual statement of Zhejiang Expressway, it seems that company is thinking out the frontier risks that can impact Misc. Transportation 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 strategic competitive environment developments
– As Zhejiang Expressway is one of the leading players in the Misc. Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Transportation industry in last five years.
High dependence on Zhejiang Expressway ‘s star products
– The top 2 products and services of Zhejiang Expressway still accounts for major business revenue. This dependence on star products in Misc. Transportation industry has resulted into insufficient focus on developing new products, even though Zhejiang Expressway has relatively successful track record of launching new products.
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 Zhejiang Expressway supply chain. Even after few cautionary changes, Zhejiang Expressway is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Zhejiang Expressway vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of Zhejiang Expressway is just above the Misc. Transportation 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
Zhejiang Expressway has a high cash cycle compare to other players in the Misc. Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Skills based hiring in Misc. Transportation industry
– The stress on hiring functional specialists at Zhejiang Expressway 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.
Lack of clear differentiation of Zhejiang Expressway products
– To increase the profitability and margins on the products, Zhejiang Expressway needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– From the outside it seems that Zhejiang Expressway needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Transportation industry have deep experience in developing customer relationships. Marketing department at Zhejiang Expressway can leverage the sales team experience to cultivate customer relationships as Zhejiang Expressway is planning to shift buying processes online.
High bargaining power of channel partners in Misc. Transportation industry
– because of the regulatory requirements in Hong Kong, Zhejiang Expressway 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 Misc. Transportation industry.
Zhejiang Expressway Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Zhejiang Expressway are -
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. Zhejiang Expressway can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Zhejiang Expressway can use the latest technology developments to improve its manufacturing and designing process in Misc. Transportation 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Transportation industry, but it has also influenced the consumer preferences. Zhejiang Expressway can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Zhejiang Expressway can improve the customer journey of consumers in the Misc. Transportation 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.
Developing new processes and practices
– Zhejiang Expressway can develop new processes and procedures in Misc. Transportation 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, Zhejiang Expressway is facing challenges because of the dominance of functional experts in the organization. Zhejiang Expressway can utilize new technology in the field of Misc. Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Zhejiang Expressway 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 Misc. Transportation industry.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Zhejiang Expressway 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 Zhejiang Expressway to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Zhejiang Expressway has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Transportation sector. This continuous investment in analytics has enabled Zhejiang Expressway to build a competitive advantage using analytics. The analytics driven competitive advantage can help Zhejiang Expressway to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Zhejiang Expressway 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. Zhejiang Expressway 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.
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 Zhejiang Expressway 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Zhejiang Expressway 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Zhejiang Expressway can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Zhejiang Expressway External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Zhejiang Expressway are -
Easy access to finance
– Easy access to finance in Misc. Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Zhejiang Expressway can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Zhejiang Expressway in the Misc. Transportation sector and impact the bottomline of the organization.
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.
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 Zhejiang Expressway business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Zhejiang Expressway 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 Misc. Transportation industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Transportation industry are lowering. It can presents Zhejiang Expressway with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Transportation sector.
Technology acceleration in Forth Industrial Revolution
– Zhejiang Expressway has witnessed rapid integration of technology during Covid-19 in the Misc. Transportation industry. As one of the leading players in the industry, Zhejiang Expressway needs to keep up with the evolution of technology in the Misc. Transportation 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
– Zhejiang Expressway 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 Misc. Transportation industry regulations.
Stagnating economy with rate increase
– Zhejiang Expressway 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 Misc. Transportation industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Zhejiang Expressway 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 Zhejiang Expressway prominent markets.
Environmental challenges
– Zhejiang Expressway 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. Zhejiang Expressway can take advantage of this fund but it will also bring new competitors in the Misc. Transportation 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. Zhejiang Expressway will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Increasing wage structure of Zhejiang Expressway
– 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 Zhejiang Expressway.
Weighted SWOT Analysis of Zhejiang Expressway Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Zhejiang Expressway 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 Zhejiang Expressway 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 Zhejiang Expressway 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 Zhejiang Expressway 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 Zhejiang Expressway needs to make to build a sustainable competitive advantage.