CITIC Telecom Int (1883) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for CITIC Telecom Int (Hong Kong)

Based on various researches at Oak Spring University , CITIC Telecom Int is operating in a macro-environment that has been destablized by – wage bills are increasing, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, technology disruption, supply chains are disrupted by pandemic , etc

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Introduction to SWOT Analysis of CITIC Telecom Int

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that CITIC Telecom Int can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the CITIC Telecom Int, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which CITIC Telecom Int 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 CITIC Telecom Int can be done for the following purposes –
1. Strategic planning of CITIC Telecom Int
2. Improving business portfolio management of CITIC Telecom Int
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Communications Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of CITIC Telecom Int

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Strengths of CITIC Telecom Int | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of CITIC Telecom Int are -

Learning organization

- CITIC Telecom Int 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 CITIC Telecom Int is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at CITIC Telecom Int emphasize – knowledge, initiative, and innovation.

Successful track record of launching new products

– CITIC Telecom Int has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. CITIC Telecom Int 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.

Training and development

– CITIC Telecom Int 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.

Strong track record of project management in the Communications Services industry

– CITIC Telecom Int 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

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

Operational resilience

– The operational resilience strategy of CITIC Telecom Int comprises – understanding the underlying the factors in the Communications Services 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.

Sustainable margins compare to other players in Communications Services industry

– CITIC Telecom Int has clearly differentiated products in the market place. This has enabled CITIC Telecom Int to fetch slight price premium compare to the competitors in the Communications Services industry. The sustainable margins have also helped CITIC Telecom Int to invest into research and development (R&D) and innovation.

Highly skilled collaborators

– CITIC Telecom Int has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Communications Services industry. Secondly the value chain collaborators of CITIC Telecom Int have helped the firm to develop new products and bring them quickly to the marketplace.

Superior customer experience

– The customer experience strategy of CITIC Telecom Int in Communications Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Low bargaining power of suppliers

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

Cross disciplinary teams

– Horizontal connected teams at the CITIC Telecom Int 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.

Ability to recruit top talent

– CITIC Telecom Int is one of the leading players in the Communications 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.

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Weaknesses of CITIC Telecom Int | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of CITIC Telecom Int are -

Slow to strategic competitive environment developments

– As CITIC Telecom Int is one of the leading players in the Communications Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Communications Services industry in last five years.

High operating costs

– Compare to the competitors, CITIC Telecom Int has high operating costs in the Communications Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract CITIC Telecom Int lucrative customers.

Slow to harness new channels of communication

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

Need for greater diversity

– CITIC Telecom Int 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.

No frontier risks strategy

– From the 10K / annual statement of CITIC Telecom Int, it seems that company is thinking out the frontier risks that can impact Communications Services 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.

Increasing silos among functional specialists

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

Aligning sales with marketing

– From the outside it seems that CITIC Telecom Int needs to have more collaboration between its sales team and marketing team. Sales professionals in the Communications Services industry have deep experience in developing customer relationships. Marketing department at CITIC Telecom Int can leverage the sales team experience to cultivate customer relationships as CITIC Telecom Int is planning to shift buying processes online.

Skills based hiring in Communications Services industry

– The stress on hiring functional specialists at CITIC Telecom Int 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.

High cash cycle compare to competitors

CITIC Telecom Int has a high cash cycle compare to other players in the Communications Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Capital Spending Reduction

– Even during the low interest decade, CITIC Telecom Int 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 Communications Services industry using digital technology.

High dependence on CITIC Telecom Int ‘s star products

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

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CITIC Telecom Int Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of CITIC Telecom Int are -

Building a culture of innovation

– managers at CITIC Telecom Int 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 Communications Services industry.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Communications Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. CITIC Telecom Int 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. CITIC Telecom Int 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.

Developing new processes and practices

– CITIC Telecom Int can develop new processes and procedures in Communications Services 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.

Remote work and new talent hiring opportunities

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

Low interest rates

– Even though inflation is raising its head in most developed economies, CITIC Telecom Int 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.

Harnessing reconfiguration of the global supply chains

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

Using analytics as competitive advantage

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

Use of Bitcoin and other crypto currencies for transactions in Communications Services industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for CITIC Telecom Int in the Communications Services industry. Now CITIC Telecom Int can target international markets with far fewer capital restrictions requirements than the existing system.

Learning at scale

– Online learning technologies has now opened space for CITIC Telecom Int 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, CITIC Telecom Int can use these opportunities to build new business models that can help the communities that CITIC Telecom Int operates in. Secondly it can use opportunities from government spending in Communications Services sector.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Communications Services industry, but it has also influenced the consumer preferences. CITIC Telecom Int can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Creating value in data economy

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

Manufacturing automation

– CITIC Telecom Int can use the latest technology developments to improve its manufacturing and designing process in Communications 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.

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Threats CITIC Telecom Int External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of CITIC Telecom Int are -

Stagnating economy with rate increase

– CITIC Telecom Int 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 Communications Services 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. CITIC Telecom Int 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.

Shortening product life cycle

– it is one of the major threat that CITIC Telecom Int is facing in Communications Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Environmental challenges

– CITIC Telecom Int 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. CITIC Telecom Int can take advantage of this fund but it will also bring new competitors in the Communications Services 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 CITIC Telecom Int 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 Communications Services industry and other sectors.

Technology acceleration in Forth Industrial Revolution

– CITIC Telecom Int has witnessed rapid integration of technology during Covid-19 in the Communications Services industry. As one of the leading players in the industry, CITIC Telecom Int needs to keep up with the evolution of technology in the Communications 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.

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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, CITIC Telecom Int may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communications Services sector.

Easy access to finance

– Easy access to finance in Communications Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. CITIC Telecom Int 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 CITIC Telecom Int in the Communications Services sector and impact the bottomline of the organization.

High dependence on third party suppliers

– CITIC Telecom Int 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 international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, CITIC Telecom Int 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 CITIC Telecom Int prominent markets.

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Weighted SWOT Analysis of CITIC Telecom Int Template, Example

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

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