China e-Wallet Payment (802) SWOT Analysis / TOWS Matrix / MBA Resources
Security Systems & Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for China e-Wallet Payment (Hong Kong)
Based on various researches at Oak Spring University , China e-Wallet Payment is operating in a macro-environment that has been destablized by – wage bills are increasing, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, increasing commodity prices, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, geopolitical disruptions,
there is backlash against globalization, increasing energy prices, etc
Introduction to SWOT Analysis of China e-Wallet Payment
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that China e-Wallet Payment can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the China e-Wallet Payment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which China e-Wallet Payment 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 China e-Wallet Payment can be done for the following purposes –
1. Strategic planning of China e-Wallet Payment
2. Improving business portfolio management of China e-Wallet Payment
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Security Systems & Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of China e-Wallet Payment
Strengths of China e-Wallet Payment | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of China e-Wallet Payment are -
Cross disciplinary teams
– Horizontal connected teams at the China e-Wallet Payment 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.
Digital Transformation in Security Systems & Services industry
- digital transformation varies from industry to industry. For China e-Wallet Payment digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. China e-Wallet Payment 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.
Superior customer experience
– The customer experience strategy of China e-Wallet Payment in Security Systems & Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of China e-Wallet Payment in the Services sector have low bargaining power. China e-Wallet Payment has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps China e-Wallet Payment to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– China e-Wallet Payment has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled China e-Wallet Payment to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Security Systems & Services industry
– China e-Wallet Payment is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Security Systems & Services industry
– China e-Wallet Payment has clearly differentiated products in the market place. This has enabled China e-Wallet Payment to fetch slight price premium compare to the competitors in the Security Systems & Services industry. The sustainable margins have also helped China e-Wallet Payment to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– China e-Wallet Payment has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. China e-Wallet Payment 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.
Operational resilience
– The operational resilience strategy of China e-Wallet Payment comprises – understanding the underlying the factors in the Security Systems & 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.
Ability to recruit top talent
– China e-Wallet Payment is one of the leading players in the Security Systems & Services 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.
Ability to lead change in Security Systems & Services
– China e-Wallet Payment is one of the leading players in the Security Systems & Services industry in Hong Kong. Over the years it has not only transformed the business landscape in the Security Systems & Services industry in Hong Kong but also across the existing markets. The ability to lead change has enabled China e-Wallet Payment in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that China e-Wallet Payment 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 China e-Wallet Payment | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of China e-Wallet Payment are -
High operating costs
– Compare to the competitors, China e-Wallet Payment has high operating costs in the Security Systems & Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract China e-Wallet Payment lucrative customers.
Slow decision making process
– As mentioned earlier in the report, China e-Wallet Payment has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Security Systems & Services industry over the last five years. China e-Wallet Payment 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.
Compensation and incentives
– The revenue per employee of China e-Wallet Payment is just above the Security Systems & 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.
High bargaining power of channel partners in Security Systems & Services industry
– because of the regulatory requirements in Hong Kong, China e-Wallet Payment 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 Security Systems & Services industry.
Ability to respond to the competition
– As the decision making is very deliberative at China e-Wallet Payment, in the dynamic environment of Security Systems & Services industry it has struggled to respond to the nimble upstart competition. China e-Wallet Payment has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though China e-Wallet Payment has some of the most successful models in the Security Systems & Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. China e-Wallet Payment should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– From the 10K / annual statement of China e-Wallet Payment, it seems that company is thinking out the frontier risks that can impact Security Systems & 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.
Capital Spending Reduction
– Even during the low interest decade, China e-Wallet Payment 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 Security Systems & Services industry using digital technology.
Low market penetration in new markets
– Outside its home market of Hong Kong, China e-Wallet Payment needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring in Security Systems & Services industry
– The stress on hiring functional specialists at China e-Wallet Payment 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.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of China e-Wallet Payment supply chain. Even after few cautionary changes, China e-Wallet Payment is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left China e-Wallet Payment vulnerable to further global disruptions in South East Asia.
China e-Wallet Payment Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of China e-Wallet Payment are -
Low interest rates
– Even though inflation is raising its head in most developed economies, China e-Wallet Payment 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Security Systems & Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. China e-Wallet Payment 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. China e-Wallet Payment 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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help China e-Wallet Payment to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Leveraging digital technologies
– China e-Wallet Payment 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.
Manufacturing automation
– China e-Wallet Payment can use the latest technology developments to improve its manufacturing and designing process in Security Systems & Services 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.
Learning at scale
– Online learning technologies has now opened space for China e-Wallet Payment 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.
Loyalty marketing
– China e-Wallet Payment 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.
Using analytics as competitive advantage
– China e-Wallet Payment has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Security Systems & Services sector. This continuous investment in analytics has enabled China e-Wallet Payment to build a competitive advantage using analytics. The analytics driven competitive advantage can help China e-Wallet Payment to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at China e-Wallet Payment 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 Security Systems & Services industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Security Systems & Services industry, but it has also influenced the consumer preferences. China e-Wallet Payment can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help China e-Wallet Payment to increase its market reach. China e-Wallet Payment 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.
Buying journey improvements
– China e-Wallet Payment can improve the customer journey of consumers in the Security Systems & 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, China e-Wallet Payment can use these opportunities to build new business models that can help the communities that China e-Wallet Payment operates in. Secondly it can use opportunities from government spending in Security Systems & Services sector.
Threats China e-Wallet Payment External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of China e-Wallet Payment are -
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 China e-Wallet Payment business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– China e-Wallet Payment 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 Security Systems & Services industry regulations.
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 China e-Wallet Payment in the Security Systems & Services sector and impact the bottomline of the organization.
Environmental challenges
– China e-Wallet Payment 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. China e-Wallet Payment can take advantage of this fund but it will also bring new competitors in the Security Systems & Services industry.
Stagnating economy with rate increase
– China e-Wallet Payment 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 Security Systems & Services industry.
Increasing wage structure of China e-Wallet Payment
– 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 China e-Wallet Payment.
Technology acceleration in Forth Industrial Revolution
– China e-Wallet Payment has witnessed rapid integration of technology during Covid-19 in the Security Systems & Services industry. As one of the leading players in the industry, China e-Wallet Payment needs to keep up with the evolution of technology in the Security Systems & 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.
Consumer confidence and its impact on China e-Wallet Payment 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 Security Systems & Services industry and other sectors.
Easy access to finance
– Easy access to finance in Security Systems & Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. China e-Wallet Payment can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for China e-Wallet Payment in Security Systems & Services industry. The Security Systems & Services 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.
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 China e-Wallet Payment.
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.
High dependence on third party suppliers
– China e-Wallet Payment 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.
Weighted SWOT Analysis of China e-Wallet Payment Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at China e-Wallet Payment 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 China e-Wallet Payment 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 China e-Wallet Payment 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 China e-Wallet Payment 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 China e-Wallet Payment needs to make to build a sustainable competitive advantage.