Tian Shan Development (2118) SWOT Analysis / TOWS Matrix / MBA Resources
Construction Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Tian Shan Development (Hong Kong)
Based on various researches at Oak Spring University , Tian Shan Development is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, technology disruption, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models,
challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Tian Shan Development
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tian Shan Development can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tian Shan Development, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tian Shan Development 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 Tian Shan Development can be done for the following purposes –
1. Strategic planning of Tian Shan Development
2. Improving business portfolio management of Tian Shan Development
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tian Shan Development
Strengths of Tian Shan Development | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tian Shan Development are -
Learning organization
- Tian Shan Development 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 Tian Shan Development is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tian Shan Development emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Construction Services industry
– Tian Shan Development has clearly differentiated products in the market place. This has enabled Tian Shan Development to fetch slight price premium compare to the competitors in the Construction Services industry. The sustainable margins have also helped Tian Shan Development to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Tian Shan Development has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Tian Shan Development 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.
Digital Transformation in Construction Services industry
- digital transformation varies from industry to industry. For Tian Shan Development digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tian Shan Development has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Diverse revenue streams
– Tian Shan Development is present in almost all the verticals within the Construction Services industry. This has provided Tian Shan Development a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Cross disciplinary teams
– Horizontal connected teams at the Tian Shan Development 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.
Low bargaining power of suppliers
– Suppliers of Tian Shan Development in the Capital Goods sector have low bargaining power. Tian Shan Development has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tian Shan Development to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the Construction Services industry
– Tian Shan Development is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Tian Shan Development 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 Construction Services 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.
High brand equity
– Tian Shan Development has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tian Shan Development to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Tian Shan Development has one of the best training and development program in Capital Goods industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Innovation driven organization
– Tian Shan Development is one of the most innovative firm in Construction Services sector.
Weaknesses of Tian Shan Development | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Tian Shan Development are -
Products dominated business model
– Even though Tian Shan Development has some of the most successful models in the Construction Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Tian Shan Development should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Hong Kong, Tian Shan Development needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ less understanding of Tian Shan Development strategy
– From the outside it seems that the employees of Tian Shan Development 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.
Lack of clear differentiation of Tian Shan Development products
– To increase the profitability and margins on the products, Tian Shan Development needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Tian Shan Development 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.
Capital Spending Reduction
– Even during the low interest decade, Tian Shan Development 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 Construction Services industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative at Tian Shan Development, in the dynamic environment of Construction Services industry it has struggled to respond to the nimble upstart competition. Tian Shan Development has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Tian Shan Development is dominated by functional specialists. It is not different from other players in the Construction Services industry, but Tian Shan Development needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tian Shan Development to focus more on services in the Construction Services industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, Tian Shan Development has high operating costs in the Construction Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Tian Shan Development lucrative customers.
High cash cycle compare to competitors
Tian Shan Development has a high cash cycle compare to other players in the Construction 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tian Shan Development is slow explore the new channels of communication. These new channels of communication can help Tian Shan Development to provide better information regarding Construction Services products and services. It can also build an online community to further reach out to potential customers.
Tian Shan Development Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Tian Shan Development are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Construction Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Tian Shan Development 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. Tian Shan Development 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
– Tian Shan Development can develop new processes and procedures in Construction 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tian Shan Development can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tian Shan Development 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 Tian Shan Development 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, Tian Shan Development 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.
Buying journey improvements
– Tian Shan Development can improve the customer journey of consumers in the Construction Services 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.
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. Tian Shan Development can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Tian Shan Development 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 Construction Services industry.
Using analytics as competitive advantage
– Tian Shan Development has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Construction Services sector. This continuous investment in analytics has enabled Tian Shan Development to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tian Shan Development 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, Tian Shan Development is facing challenges because of the dominance of functional experts in the organization. Tian Shan Development can utilize new technology in the field of Construction Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tian Shan Development in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Construction Services industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Tian Shan Development has opened avenues for new revenue streams for the organization in Construction Services industry. This can help Tian Shan Development to build a more holistic ecosystem for Tian Shan Development products in the Construction Services 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 Construction Services industry, but it has also influenced the consumer preferences. Tian Shan Development can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Tian Shan Development External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Tian Shan Development are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Tian Shan Development may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Construction Services sector.
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.
Shortening product life cycle
– it is one of the major threat that Tian Shan Development is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Tian Shan Development 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. Tian Shan Development can take advantage of this fund but it will also bring new competitors in the Construction Services industry.
High dependence on third party suppliers
– Tian Shan Development 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.
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. Tian Shan Development needs to understand the core reasons impacting the Construction Services industry. This will help it in building a better workplace.
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 Tian Shan Development in the Construction Services sector and impact the bottomline of the organization.
Consumer confidence and its impact on Tian Shan Development 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 Construction Services industry and other sectors.
Stagnating economy with rate increase
– Tian Shan Development 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 Construction Services industry.
Increasing wage structure of Tian Shan Development
– 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 Tian Shan Development.
Technology acceleration in Forth Industrial Revolution
– Tian Shan Development has witnessed rapid integration of technology during Covid-19 in the Construction Services industry. As one of the leading players in the industry, Tian Shan Development needs to keep up with the evolution of technology in the Construction 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.
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 Tian Shan Development.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tian Shan Development 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 Tian Shan Development prominent markets.
Weighted SWOT Analysis of Tian Shan Development Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tian Shan Development 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 Tian Shan Development 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 Tian Shan Development 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 Tian Shan Development 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 Tian Shan Development needs to make to build a sustainable competitive advantage.