SWOT Analysis / TOWS Matrix for Earthasia Intl (Hong Kong)
Based on various researches at Oak Spring University , Earthasia Intl is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, supply chains are disrupted by pandemic , increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels,
competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Earthasia Intl can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Earthasia Intl, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Earthasia Intl 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 Earthasia Intl can be done for the following purposes –
1. Strategic planning of Earthasia Intl
2. Improving business portfolio management of Earthasia Intl
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Personal Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Earthasia Intl
Strengths of Earthasia Intl | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Earthasia Intl are -
Superior customer experience
– The customer experience strategy of Earthasia Intl in Personal Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Earthasia Intl is present in almost all the verticals within the Personal Services industry. This has provided Earthasia Intl 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.
Analytics focus
– Earthasia Intl 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 Personal 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.
Low bargaining power of suppliers
– Suppliers of Earthasia Intl in the Services sector have low bargaining power. Earthasia Intl has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Earthasia Intl to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Earthasia Intl has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Earthasia Intl 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.
Organizational Resilience of Earthasia Intl
– The covid-19 pandemic has put organizational resilience at the centre of everthing Earthasia Intl does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Personal Services
– Earthasia Intl is one of the leading players in the Personal Services industry in Hong Kong. Over the years it has not only transformed the business landscape in the Personal Services industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Earthasia Intl in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Personal Services industry
– Earthasia Intl has clearly differentiated products in the market place. This has enabled Earthasia Intl to fetch slight price premium compare to the competitors in the Personal Services industry. The sustainable margins have also helped Earthasia Intl to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Earthasia Intl has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Earthasia Intl staying ahead in the Personal Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of Earthasia Intl comprises – understanding the underlying the factors in the Personal 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.
Digital Transformation in Personal Services industry
- digital transformation varies from industry to industry. For Earthasia Intl digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Earthasia Intl 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.
High brand equity
– Earthasia Intl has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Earthasia Intl to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Earthasia Intl | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Earthasia Intl are -
Ability to respond to the competition
– As the decision making is very deliberative at Earthasia Intl, in the dynamic environment of Personal Services industry it has struggled to respond to the nimble upstart competition. Earthasia Intl has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Earthasia Intl products
– To increase the profitability and margins on the products, Earthasia Intl needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Earthasia Intl is one of the leading players in the Personal Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Personal Services industry in last five years.
Aligning sales with marketing
– From the outside it seems that Earthasia Intl needs to have more collaboration between its sales team and marketing team. Sales professionals in the Personal Services industry have deep experience in developing customer relationships. Marketing department at Earthasia Intl can leverage the sales team experience to cultivate customer relationships as Earthasia Intl is planning to shift buying processes online.
Skills based hiring in Personal Services industry
– The stress on hiring functional specialists at Earthasia Intl 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.
No frontier risks strategy
– From the 10K / annual statement of Earthasia Intl, it seems that company is thinking out the frontier risks that can impact Personal 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.
Compensation and incentives
– The revenue per employee of Earthasia Intl is just above the Personal Services 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.
Workers concerns about automation
– As automation is fast increasing in the Personal Services industry, Earthasia Intl 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 Earthasia Intl has some of the most successful models in the Personal Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Earthasia Intl should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Earthasia Intl is dominated by functional specialists. It is not different from other players in the Personal Services industry, but Earthasia Intl needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Earthasia Intl to focus more on services in the Personal Services industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Hong Kong, Earthasia Intl needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Earthasia Intl Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Earthasia Intl are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Earthasia Intl 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 Earthasia Intl 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Earthasia Intl 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 Earthasia Intl 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 Personal Services industry, but it has also influenced the consumer preferences. Earthasia Intl can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Earthasia Intl can use these opportunities to build new business models that can help the communities that Earthasia Intl operates in. Secondly it can use opportunities from government spending in Personal Services sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Earthasia Intl 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 Earthasia Intl to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Earthasia Intl has opened avenues for new revenue streams for the organization in Personal Services industry. This can help Earthasia Intl to build a more holistic ecosystem for Earthasia Intl products in the Personal Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Earthasia Intl is facing challenges because of the dominance of functional experts in the organization. Earthasia Intl can utilize new technology in the field of Personal Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Earthasia Intl 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.
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. Earthasia Intl can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Earthasia Intl to increase its market reach. Earthasia Intl 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.
Building a culture of innovation
– managers at Earthasia Intl 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 Personal Services industry.
Leveraging digital technologies
– Earthasia Intl 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.
Threats Earthasia Intl External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Earthasia Intl are -
Consumer confidence and its impact on Earthasia Intl 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 Personal Services industry and other sectors.
Environmental challenges
– Earthasia Intl 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. Earthasia Intl can take advantage of this fund but it will also bring new competitors in the Personal Services industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Personal Services industry are lowering. It can presents Earthasia Intl with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Personal Services sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Earthasia Intl 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 Earthasia Intl prominent markets.
Easy access to finance
– Easy access to finance in Personal Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Earthasia Intl can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Earthasia Intl may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Personal Services sector.
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 Earthasia Intl.
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 Earthasia Intl in the Personal Services sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Earthasia Intl is facing in Personal Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. Earthasia Intl needs to understand the core reasons impacting the Personal Services industry. This will help it in building a better workplace.
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.
High dependence on third party suppliers
– Earthasia Intl 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.
Stagnating economy with rate increase
– Earthasia Intl 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 Personal Services industry.
Weighted SWOT Analysis of Earthasia Intl Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Earthasia Intl 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 Earthasia Intl 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 Earthasia Intl 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 Earthasia Intl 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 Earthasia Intl needs to make to build a sustainable competitive advantage.
