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Digital China (861) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Digital China (Hong Kong)


Based on various researches at Oak Spring University , Digital China is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, etc



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Introduction to SWOT Analysis of Digital China


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




SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix


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




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

The strengths of Digital China are -

Training and development

– Digital China has one of the best training and development program in Technology 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.

Highly skilled collaborators

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

Analytics focus

– Digital China is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Computer Hardware industry. The technology infrastructure of Hong Kong is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Superior customer experience

– The customer experience strategy of Digital China in Computer Hardware industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Successful track record of launching new products

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

Cross disciplinary teams

– Horizontal connected teams at the Digital 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.

Ability to recruit top talent

– Digital China is one of the leading players in the Computer Hardware 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.

Strong track record of project management in the Computer Hardware industry

– Digital 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.

Effective Research and Development (R&D)

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

Learning organization

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

Operational resilience

– The operational resilience strategy of Digital China comprises – understanding the underlying the factors in the Computer Hardware 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 Computer Hardware industry

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



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Net Promoter Score



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

The weaknesses of Digital China are -

High dependence on Digital China ‘s star products

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

High operating costs

– Compare to the competitors, Digital China has high operating costs in the Computer Hardware industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Digital China lucrative customers.

Aligning sales with marketing

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

Workers concerns about automation

– As automation is fast increasing in the Computer Hardware industry, Digital 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.

Products dominated business model

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

Compensation and incentives

– The revenue per employee of Digital China is just above the Computer Hardware 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.

Increasing silos among functional specialists

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

Interest costs

– Compare to the competition, Digital 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 cash cycle compare to competitors

Digital China has a high cash cycle compare to other players in the Computer Hardware industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

High bargaining power of channel partners in Computer Hardware industry

– because of the regulatory requirements in Hong Kong, Digital 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 Computer Hardware industry.

No frontier risks strategy

– From the 10K / annual statement of Digital China, it seems that company is thinking out the frontier risks that can impact Computer Hardware 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.




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


The opportunities of Digital China are -

Redefining models of collaboration and team work

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

Buying journey improvements

– Digital China can improve the customer journey of consumers in the Computer Hardware 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

– Digital China can develop new processes and procedures in Computer Hardware 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.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Digital 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, Digital 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.

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. Digital China can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Learning at scale

– Online learning technologies has now opened space for Digital 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.

Increase in government spending

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

Lowering marketing communication costs

– 5G expansion will open new opportunities for Digital 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 Computer Hardware industry, and it will provide faster access to the consumers.

Manufacturing automation

– Digital China can use the latest technology developments to improve its manufacturing and designing process in Computer Hardware 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.

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 Digital China 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.

Creating value in data economy

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

Finding new ways to collaborate

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




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


The threats of Digital China are -

Environmental challenges

– Digital 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. Digital China can take advantage of this fund but it will also bring new competitors in the Computer Hardware industry.

Backlash against dominant players

– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Digital China business can come under increasing regulations regarding data privacy, data security, etc.

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. Digital China needs to understand the core reasons impacting the Computer Hardware industry. This will help it in building a better workplace.

Increasing international competition and downward pressure on margins

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

Consumer confidence and its impact on Digital China 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 Computer Hardware industry and other sectors.

Technology acceleration in Forth Industrial Revolution

– Digital China has witnessed rapid integration of technology during Covid-19 in the Computer Hardware industry. As one of the leading players in the industry, Digital China needs to keep up with the evolution of technology in the Computer Hardware 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.

Increasing wage structure of Digital 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 Digital China.

High dependence on third party suppliers

– Digital 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.

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 Digital China in the Computer Hardware 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.

Shortening product life cycle

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

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. Digital China 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, Digital China may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Computer Hardware sector.




Weighted SWOT Analysis of Digital China Template, Example


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



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