SWOT Analysis / TOWS Matrix for Virscend Education (Hong Kong)
Based on various researches at Oak Spring University , Virscend Education is operating in a macro-environment that has been destablized by – increasing energy prices, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing commodity prices, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Virscend Education
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Virscend Education can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Virscend Education, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Virscend Education 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 Virscend Education can be done for the following purposes –
1. Strategic planning of Virscend Education
2. Improving business portfolio management of Virscend Education
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Schools sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Virscend Education
Strengths of Virscend Education | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Virscend Education are -
Learning organization
- Virscend Education 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 Virscend Education is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Virscend Education emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Virscend Education
– The covid-19 pandemic has put organizational resilience at the centre of everthing Virscend Education does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Virscend Education has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Virscend Education staying ahead in the Schools industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Virscend Education has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Schools industry. Secondly the value chain collaborators of Virscend Education have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Virscend Education is one of the leading players in the Schools 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.
Successful track record of launching new products
– Virscend Education has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Virscend Education 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.
Superior customer experience
– The customer experience strategy of Virscend Education in Schools industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Virscend Education has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Virscend Education 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.
Digital Transformation in Schools industry
- digital transformation varies from industry to industry. For Virscend Education digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Virscend Education 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.
Strong track record of project management in the Schools industry
– Virscend Education 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
– Virscend Education has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Virscend Education to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Virscend Education | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Virscend Education are -
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 Virscend Education supply chain. Even after few cautionary changes, Virscend Education is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Virscend Education vulnerable to further global disruptions in South East Asia.
Skills based hiring in Schools industry
– The stress on hiring functional specialists at Virscend Education 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.
Compensation and incentives
– The revenue per employee of Virscend Education is just above the Schools 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.
Low market penetration in new markets
– Outside its home market of Hong Kong, Virscend Education needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Virscend Education ‘s star products
– The top 2 products and services of Virscend Education still accounts for major business revenue. This dependence on star products in Schools industry has resulted into insufficient focus on developing new products, even though Virscend Education has relatively successful track record of launching new products.
No frontier risks strategy
– From the 10K / annual statement of Virscend Education, it seems that company is thinking out the frontier risks that can impact Schools 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.
High operating costs
– Compare to the competitors, Virscend Education has high operating costs in the Schools industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Virscend Education lucrative customers.
High bargaining power of channel partners in Schools industry
– because of the regulatory requirements in Hong Kong, Virscend Education 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 Schools industry.
Increasing silos among functional specialists
– The organizational structure of Virscend Education is dominated by functional specialists. It is not different from other players in the Schools industry, but Virscend Education needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Virscend Education to focus more on services in the Schools industry rather than just following the product oriented approach.
Aligning sales with marketing
– From the outside it seems that Virscend Education needs to have more collaboration between its sales team and marketing team. Sales professionals in the Schools industry have deep experience in developing customer relationships. Marketing department at Virscend Education can leverage the sales team experience to cultivate customer relationships as Virscend Education is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Virscend Education is slow explore the new channels of communication. These new channels of communication can help Virscend Education to provide better information regarding Schools products and services. It can also build an online community to further reach out to potential customers.
Virscend Education Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Virscend Education 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. Virscend Education can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Schools industry, but it has also influenced the consumer preferences. Virscend Education can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Virscend Education 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 Virscend Education to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Virscend Education can use these opportunities to build new business models that can help the communities that Virscend Education operates in. Secondly it can use opportunities from government spending in Schools sector.
Building a culture of innovation
– managers at Virscend Education 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 Schools industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Virscend Education 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 Virscend Education to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Virscend Education 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.
Buying journey improvements
– Virscend Education can improve the customer journey of consumers in the Schools 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.
Using analytics as competitive advantage
– Virscend Education has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Schools sector. This continuous investment in analytics has enabled Virscend Education to build a competitive advantage using analytics. The analytics driven competitive advantage can help Virscend Education to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Virscend Education is facing challenges because of the dominance of functional experts in the organization. Virscend Education can utilize new technology in the field of Schools industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Virscend Education can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Schools industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Virscend Education 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. Virscend Education 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.
Manufacturing automation
– Virscend Education can use the latest technology developments to improve its manufacturing and designing process in Schools 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.
Threats Virscend Education External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Virscend Education are -
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. Virscend Education 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Virscend Education may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Schools sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Virscend Education in Schools industry. The Schools industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Environmental challenges
– Virscend Education 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. Virscend Education can take advantage of this fund but it will also bring new competitors in the Schools industry.
High dependence on third party suppliers
– Virscend Education high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Technology acceleration in Forth Industrial Revolution
– Virscend Education has witnessed rapid integration of technology during Covid-19 in the Schools industry. As one of the leading players in the industry, Virscend Education needs to keep up with the evolution of technology in the Schools 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.
Stagnating economy with rate increase
– Virscend Education 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 Schools industry.
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 Virscend Education 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 Schools industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Schools industry are lowering. It can presents Virscend Education with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Schools sector.
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. Virscend Education needs to understand the core reasons impacting the Schools industry. This will help it in building a better workplace.
Regulatory challenges
– Virscend Education 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 Schools industry regulations.
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 Virscend Education in the Schools sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Virscend Education Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Virscend Education 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 Virscend Education 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 Virscend Education 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 Virscend Education 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 Virscend Education needs to make to build a sustainable competitive advantage.