Based on various researches at Oak Spring University , Feishang Anthracite Resources is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, increasing energy prices, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic ,
increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Feishang Anthracite Resources
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Feishang Anthracite Resources can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Feishang Anthracite Resources, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Feishang Anthracite Resources 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 Feishang Anthracite Resources can be done for the following purposes –
1. Strategic planning of Feishang Anthracite Resources
2. Improving business portfolio management of Feishang Anthracite Resources
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Coal sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Feishang Anthracite Resources
Strengths of Feishang Anthracite Resources | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Feishang Anthracite Resources are -
Innovation driven organization
– Feishang Anthracite Resources is one of the most innovative firm in Coal sector.
Learning organization
- Feishang Anthracite Resources 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 Feishang Anthracite Resources is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Feishang Anthracite Resources emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Feishang Anthracite Resources
– The covid-19 pandemic has put organizational resilience at the centre of everthing Feishang Anthracite Resources 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 Feishang Anthracite Resources in Coal industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Coal industry
– Feishang Anthracite Resources has clearly differentiated products in the market place. This has enabled Feishang Anthracite Resources to fetch slight price premium compare to the competitors in the Coal industry. The sustainable margins have also helped Feishang Anthracite Resources to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Feishang Anthracite Resources has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Feishang Anthracite Resources 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.
High brand equity
– Feishang Anthracite Resources has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Feishang Anthracite Resources to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Coal
– Feishang Anthracite Resources is one of the leading players in the Coal industry in Hong Kong. Over the years it has not only transformed the business landscape in the Coal industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Feishang Anthracite Resources in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Feishang Anthracite Resources 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 Coal 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.
Strong track record of project management in the Coal industry
– Feishang Anthracite Resources is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy of Feishang Anthracite Resources comprises – understanding the underlying the factors in the Coal 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.
High switching costs
– The high switching costs that Feishang Anthracite Resources has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses of Feishang Anthracite Resources | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Feishang Anthracite Resources are -
High operating costs
– Compare to the competitors, Feishang Anthracite Resources has high operating costs in the Coal industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Feishang Anthracite Resources lucrative customers.
High dependence on Feishang Anthracite Resources ‘s star products
– The top 2 products and services of Feishang Anthracite Resources still accounts for major business revenue. This dependence on star products in Coal industry has resulted into insufficient focus on developing new products, even though Feishang Anthracite Resources has relatively successful track record of launching new products.
High bargaining power of channel partners in Coal industry
– because of the regulatory requirements in Hong Kong, Feishang Anthracite Resources 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 Coal industry.
Aligning sales with marketing
– From the outside it seems that Feishang Anthracite Resources needs to have more collaboration between its sales team and marketing team. Sales professionals in the Coal industry have deep experience in developing customer relationships. Marketing department at Feishang Anthracite Resources can leverage the sales team experience to cultivate customer relationships as Feishang Anthracite Resources is planning to shift buying processes online.
High cash cycle compare to competitors
Feishang Anthracite Resources has a high cash cycle compare to other players in the Coal industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of Hong Kong, Feishang Anthracite Resources needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring in Coal industry
– The stress on hiring functional specialists at Feishang Anthracite Resources 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 Feishang Anthracite Resources, it seems that company is thinking out the frontier risks that can impact Coal 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.
Workers concerns about automation
– As automation is fast increasing in the Coal industry, Feishang Anthracite Resources 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.
Compensation and incentives
– The revenue per employee of Feishang Anthracite Resources is just above the Coal 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.
Employees’ less understanding of Feishang Anthracite Resources strategy
– From the outside it seems that the employees of Feishang Anthracite Resources 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.
Feishang Anthracite Resources Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Feishang Anthracite Resources are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Coal industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Feishang Anthracite Resources 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. Feishang Anthracite Resources 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Coal industry, but it has also influenced the consumer preferences. Feishang Anthracite Resources can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Feishang Anthracite Resources can develop new processes and procedures in Coal 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Feishang Anthracite Resources 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.
Creating value in data economy
– The success of analytics program of Feishang Anthracite Resources has opened avenues for new revenue streams for the organization in Coal industry. This can help Feishang Anthracite Resources to build a more holistic ecosystem for Feishang Anthracite Resources products in the Coal industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Feishang Anthracite Resources 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 Coal industry.
Better consumer reach
– The expansion of the 5G network will help Feishang Anthracite Resources to increase its market reach. Feishang Anthracite Resources 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Feishang Anthracite Resources 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 Feishang Anthracite Resources to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Feishang Anthracite Resources can use these opportunities to build new business models that can help the communities that Feishang Anthracite Resources operates in. Secondly it can use opportunities from government spending in Coal sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Feishang Anthracite Resources can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Feishang Anthracite Resources in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Coal industry, and it will provide faster access to the consumers.
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. Feishang Anthracite Resources can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Feishang Anthracite Resources is facing challenges because of the dominance of functional experts in the organization. Feishang Anthracite Resources can utilize new technology in the field of Coal industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Feishang Anthracite Resources External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Feishang Anthracite Resources are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Feishang Anthracite Resources in Coal industry. The Coal 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.
Regulatory challenges
– Feishang Anthracite Resources needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Coal industry regulations.
High dependence on third party suppliers
– Feishang Anthracite Resources 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Coal industry are lowering. It can presents Feishang Anthracite Resources with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Coal sector.
Increasing wage structure of Feishang Anthracite Resources
– 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 Feishang Anthracite Resources.
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 Feishang Anthracite Resources in the Coal sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Coal industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Feishang Anthracite Resources can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Feishang Anthracite Resources business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Feishang Anthracite Resources 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 Coal 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 Feishang Anthracite Resources.
Technology acceleration in Forth Industrial Revolution
– Feishang Anthracite Resources has witnessed rapid integration of technology during Covid-19 in the Coal industry. As one of the leading players in the industry, Feishang Anthracite Resources needs to keep up with the evolution of technology in the Coal 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.
Consumer confidence and its impact on Feishang Anthracite Resources 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 Coal industry and other sectors.
Shortening product life cycle
– it is one of the major threat that Feishang Anthracite Resources is facing in Coal sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Feishang Anthracite Resources Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Feishang Anthracite Resources 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 Feishang Anthracite Resources 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 Feishang Anthracite Resources 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 Feishang Anthracite Resources 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 Feishang Anthracite Resources needs to make to build a sustainable competitive advantage.