SWOT Analysis / TOWS Matrix for UMP Healthcare (Hong Kong)
Based on various researches at Oak Spring University , UMP Healthcare is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic ,
challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that UMP Healthcare can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the UMP Healthcare, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which UMP Healthcare 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 UMP Healthcare can be done for the following purposes –
1. Strategic planning of UMP Healthcare
2. Improving business portfolio management of UMP Healthcare
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Healthcare Facilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of UMP Healthcare
Strengths of UMP Healthcare | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of UMP Healthcare are -
Ability to lead change in Healthcare Facilities
– UMP Healthcare is one of the leading players in the Healthcare Facilities industry in Hong Kong. Over the years it has not only transformed the business landscape in the Healthcare Facilities industry in Hong Kong but also across the existing markets. The ability to lead change has enabled UMP Healthcare in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– UMP Healthcare has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled UMP Healthcare to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of UMP Healthcare in the Healthcare sector have low bargaining power. UMP Healthcare has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps UMP Healthcare to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– UMP Healthcare has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Healthcare Facilities industry. Secondly the value chain collaborators of UMP Healthcare have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– UMP Healthcare is present in almost all the verticals within the Healthcare Facilities industry. This has provided UMP Healthcare 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.
Sustainable margins compare to other players in Healthcare Facilities industry
– UMP Healthcare has clearly differentiated products in the market place. This has enabled UMP Healthcare to fetch slight price premium compare to the competitors in the Healthcare Facilities industry. The sustainable margins have also helped UMP Healthcare to invest into research and development (R&D) and innovation.
Digital Transformation in Healthcare Facilities industry
- digital transformation varies from industry to industry. For UMP Healthcare digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. UMP Healthcare 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.
Cross disciplinary teams
– Horizontal connected teams at the UMP Healthcare 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.
Innovation driven organization
– UMP Healthcare is one of the most innovative firm in Healthcare Facilities sector.
Ability to recruit top talent
– UMP Healthcare is one of the leading players in the Healthcare Facilities 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.
Training and development
– UMP Healthcare has one of the best training and development program in Healthcare 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.
High switching costs
– The high switching costs that UMP Healthcare 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 UMP Healthcare | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of UMP Healthcare are -
Slow decision making process
– As mentioned earlier in the report, UMP Healthcare has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Healthcare Facilities industry over the last five years. UMP Healthcare 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.
Interest costs
– Compare to the competition, UMP Healthcare 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.
Workers concerns about automation
– As automation is fast increasing in the Healthcare Facilities industry, UMP Healthcare 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.
Aligning sales with marketing
– From the outside it seems that UMP Healthcare needs to have more collaboration between its sales team and marketing team. Sales professionals in the Healthcare Facilities industry have deep experience in developing customer relationships. Marketing department at UMP Healthcare can leverage the sales team experience to cultivate customer relationships as UMP Healthcare is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at UMP Healthcare, in the dynamic environment of Healthcare Facilities industry it has struggled to respond to the nimble upstart competition. UMP Healthcare has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on UMP Healthcare ‘s star products
– The top 2 products and services of UMP Healthcare still accounts for major business revenue. This dependence on star products in Healthcare Facilities industry has resulted into insufficient focus on developing new products, even though UMP Healthcare has relatively successful track record of launching new products.
Need for greater diversity
– UMP Healthcare 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.
Compensation and incentives
– The revenue per employee of UMP Healthcare is just above the Healthcare Facilities 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.
Low market penetration in new markets
– Outside its home market of Hong Kong, UMP Healthcare needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of UMP Healthcare is dominated by functional specialists. It is not different from other players in the Healthcare Facilities industry, but UMP Healthcare needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help UMP Healthcare to focus more on services in the Healthcare Facilities industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, UMP Healthcare has high operating costs in the Healthcare Facilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract UMP Healthcare lucrative customers.
UMP Healthcare Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of UMP Healthcare are -
Developing new processes and practices
– UMP Healthcare can develop new processes and procedures in Healthcare Facilities 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Healthcare Facilities industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. UMP Healthcare 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. UMP Healthcare 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.
Building a culture of innovation
– managers at UMP Healthcare 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 Healthcare Facilities industry.
Loyalty marketing
– UMP Healthcare 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for UMP Healthcare in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Healthcare Facilities industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Healthcare Facilities industry, but it has also influenced the consumer preferences. UMP Healthcare can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for UMP Healthcare 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 UMP Healthcare to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, UMP Healthcare can use these opportunities to build new business models that can help the communities that UMP Healthcare operates in. Secondly it can use opportunities from government spending in Healthcare Facilities sector.
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. UMP Healthcare can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– UMP Healthcare has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Healthcare Facilities sector. This continuous investment in analytics has enabled UMP Healthcare to build a competitive advantage using analytics. The analytics driven competitive advantage can help UMP Healthcare to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects UMP Healthcare can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– UMP Healthcare can use the latest technology developments to improve its manufacturing and designing process in Healthcare Facilities 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, UMP Healthcare 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.
Threats UMP Healthcare External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of UMP Healthcare 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.
Environmental challenges
– UMP Healthcare 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. UMP Healthcare can take advantage of this fund but it will also bring new competitors in the Healthcare Facilities industry.
Consumer confidence and its impact on UMP Healthcare 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 Healthcare Facilities industry and other sectors.
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 UMP Healthcare in the Healthcare Facilities sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, UMP Healthcare 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 UMP Healthcare prominent markets.
Regulatory challenges
– UMP Healthcare 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 Healthcare Facilities industry regulations.
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. UMP Healthcare needs to understand the core reasons impacting the Healthcare Facilities industry. This will help it in building a better workplace.
Increasing wage structure of UMP Healthcare
– 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 UMP Healthcare.
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. UMP Healthcare 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.
Stagnating economy with rate increase
– UMP Healthcare 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 Healthcare Facilities industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for UMP Healthcare in Healthcare Facilities industry. The Healthcare Facilities 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, UMP Healthcare may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Healthcare Facilities sector.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Healthcare Facilities industry are lowering. It can presents UMP Healthcare with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Healthcare Facilities sector.
Weighted SWOT Analysis of UMP Healthcare Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at UMP Healthcare 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 UMP Healthcare 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 UMP Healthcare 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 UMP Healthcare 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 UMP Healthcare needs to make to build a sustainable competitive advantage.