SWOT Analysis / TOWS Matrix for Qilu Expressway (Hong Kong)
Based on various researches at Oak Spring University , Qilu 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, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, increasing commodity prices, increasing energy prices,
talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Qilu Expressway can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Qilu Expressway, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Qilu 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 Qilu Expressway can be done for the following purposes –
1. Strategic planning of Qilu Expressway
2. Improving business portfolio management of Qilu 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 Qilu Expressway
Strengths of Qilu Expressway | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Qilu Expressway are -
Innovation driven organization
– Qilu Expressway is one of the most innovative firm in Misc. Transportation sector.
Sustainable margins compare to other players in Misc. Transportation industry
– Qilu Expressway has clearly differentiated products in the market place. This has enabled Qilu Expressway to fetch slight price premium compare to the competitors in the Misc. Transportation industry. The sustainable margins have also helped Qilu Expressway to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Qilu Expressway 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.
Operational resilience
– The operational resilience strategy of Qilu 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.
Training and development
– Qilu 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.
Organizational Resilience of Qilu Expressway
– The covid-19 pandemic has put organizational resilience at the centre of everthing Qilu Expressway does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Qilu Expressway in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Misc. Transportation industry
- digital transformation varies from industry to industry. For Qilu Expressway digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Qilu 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.
Learning organization
- Qilu Expressway 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 Qilu Expressway is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Qilu Expressway emphasize – knowledge, initiative, and innovation.
High brand equity
– Qilu Expressway has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Qilu Expressway to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Misc. Transportation
– Qilu Expressway is one of the leading players in the Misc. Transportation industry in Hong Kong. Over the years it has not only transformed the business landscape in the Misc. Transportation industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Qilu Expressway in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Qilu 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.
Weaknesses of Qilu Expressway | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Qilu Expressway are -
Need for greater diversity
– Qilu Expressway 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Qilu Expressway is slow explore the new channels of communication. These new channels of communication can help Qilu Expressway to provide better information regarding Misc. Transportation products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Qilu Expressway 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.
Employees’ less understanding of Qilu Expressway strategy
– From the outside it seems that the employees of Qilu Expressway don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow decision making process
– As mentioned earlier in the report, Qilu 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. Qilu 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.
Capital Spending Reduction
– Even during the low interest decade, Qilu Expressway 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 Misc. Transportation industry using digital technology.
Low market penetration in new markets
– Outside its home market of Hong Kong, Qilu Expressway needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Qilu 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 cash cycle compare to competitors
Qilu 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 Qilu 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.
Ability to respond to the competition
– As the decision making is very deliberative at Qilu Expressway, in the dynamic environment of Misc. Transportation industry it has struggled to respond to the nimble upstart competition. Qilu Expressway has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Qilu Expressway Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Qilu Expressway are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Qilu Expressway 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 Qilu Expressway to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Qilu Expressway can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions in Misc. Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Qilu Expressway in the Misc. Transportation industry. Now Qilu Expressway can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Qilu Expressway can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Qilu Expressway is facing challenges because of the dominance of functional experts in the organization. Qilu 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.
Loyalty marketing
– Qilu Expressway has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
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. Qilu 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. Qilu 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.
Better consumer reach
– The expansion of the 5G network will help Qilu Expressway to increase its market reach. Qilu Expressway will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Low interest rates
– Even though inflation is raising its head in most developed economies, Qilu 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.
Learning at scale
– Online learning technologies has now opened space for Qilu Expressway 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.
Creating value in data economy
– The success of analytics program of Qilu Expressway has opened avenues for new revenue streams for the organization in Misc. Transportation industry. This can help Qilu Expressway to build a more holistic ecosystem for Qilu Expressway products in the Misc. Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Qilu 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 Qilu Expressway to build a competitive advantage using analytics. The analytics driven competitive advantage can help Qilu Expressway to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Qilu Expressway can use these opportunities to build new business models that can help the communities that Qilu Expressway operates in. Secondly it can use opportunities from government spending in Misc. Transportation sector.
Threats Qilu Expressway External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Qilu Expressway are -
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 Qilu Expressway is facing in Misc. Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Qilu 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 Qilu Expressway.
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.
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 Qilu Expressway in the Misc. Transportation sector and impact the bottomline of the organization.
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. Qilu Expressway needs to understand the core reasons impacting the Misc. Transportation industry. This will help it in building a better workplace.
Environmental challenges
– Qilu 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. Qilu Expressway can take advantage of this fund but it will also bring new competitors in the Misc. Transportation industry.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Qilu Expressway.
Consumer confidence and its impact on Qilu 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Qilu Expressway may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Transportation sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Qilu Expressway in Misc. Transportation industry. The Misc. Transportation 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.
Stagnating economy with rate increase
– Qilu 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, Qilu 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 Qilu Expressway prominent markets.
Weighted SWOT Analysis of Qilu Expressway Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Qilu 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 Qilu 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 Qilu 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 Qilu 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 Qilu Expressway needs to make to build a sustainable competitive advantage.
