Global Bio-chem Tech (809) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Global Bio-chem Tech (Hong Kong)

Based on various researches at Oak Spring University , Global Bio-chem Tech is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, geopolitical disruptions, increasing energy prices, etc

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Introduction to SWOT Analysis of Global Bio-chem Tech

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Global Bio-chem Tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Global Bio-chem Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Global Bio-chem Tech 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Global Bio-chem Tech can be done for the following purposes –
1. Strategic planning of Global Bio-chem Tech
2. Improving business portfolio management of Global Bio-chem Tech
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Global Bio-chem Tech

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Strengths of Global Bio-chem Tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Global Bio-chem Tech are -

Strong track record of project management in the Food Processing industry

– Global Bio-chem Tech is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Learning organization

- Global Bio-chem Tech 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 Global Bio-chem Tech is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Global Bio-chem Tech emphasize – knowledge, initiative, and innovation.

Low bargaining power of suppliers

– Suppliers of Global Bio-chem Tech in the Consumer/Non-Cyclical sector have low bargaining power. Global Bio-chem Tech has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Global Bio-chem Tech to manage not only supply disruptions but also source products at highly competitive prices.

Highly skilled collaborators

– Global Bio-chem Tech has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Food Processing industry. Secondly the value chain collaborators of Global Bio-chem Tech have helped the firm to develop new products and bring them quickly to the marketplace.

Effective Research and Development (R&D)

– Global Bio-chem Tech has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Global Bio-chem Tech staying ahead in the Food Processing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Sustainable margins compare to other players in Food Processing industry

– Global Bio-chem Tech has clearly differentiated products in the market place. This has enabled Global Bio-chem Tech to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped Global Bio-chem Tech to invest into research and development (R&D) and innovation.

Cross disciplinary teams

– Horizontal connected teams at the Global Bio-chem Tech 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.

Ability to recruit top talent

– Global Bio-chem Tech is one of the leading players in the Food Processing 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.

Digital Transformation in Food Processing industry

- digital transformation varies from industry to industry. For Global Bio-chem Tech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Global Bio-chem Tech 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

– Global Bio-chem Tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Global Bio-chem Tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Successful track record of launching new products

– Global Bio-chem Tech has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Global Bio-chem Tech 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.

Innovation driven organization

– Global Bio-chem Tech is one of the most innovative firm in Food Processing sector.

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Weaknesses of Global Bio-chem Tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Global Bio-chem Tech are -

Aligning sales with marketing

– From the outside it seems that Global Bio-chem Tech needs to have more collaboration between its sales team and marketing team. Sales professionals in the Food Processing industry have deep experience in developing customer relationships. Marketing department at Global Bio-chem Tech can leverage the sales team experience to cultivate customer relationships as Global Bio-chem Tech is planning to shift buying processes online.

Need for greater diversity

– Global Bio-chem Tech 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.

High bargaining power of channel partners in Food Processing industry

– because of the regulatory requirements in Hong Kong, Global Bio-chem Tech 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 Food Processing industry.

Lack of clear differentiation of Global Bio-chem Tech products

– To increase the profitability and margins on the products, Global Bio-chem Tech needs to provide more differentiated products than what it is currently offering in the marketplace.

Compensation and incentives

– The revenue per employee of Global Bio-chem Tech is just above the Food Processing 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 Global Bio-chem Tech strategy

– From the outside it seems that the employees of Global Bio-chem Tech 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.

High dependence on Global Bio-chem Tech ‘s star products

– The top 2 products and services of Global Bio-chem Tech still accounts for major business revenue. This dependence on star products in Food Processing industry has resulted into insufficient focus on developing new products, even though Global Bio-chem Tech has relatively successful track record of launching new products.

No frontier risks strategy

– From the 10K / annual statement of Global Bio-chem Tech, it seems that company is thinking out the frontier risks that can impact Food Processing 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.

High cash cycle compare to competitors

Global Bio-chem Tech has a high cash cycle compare to other players in the Food Processing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Capital Spending Reduction

– Even during the low interest decade, Global Bio-chem Tech 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 Food Processing industry using digital technology.

Low market penetration in new markets

– Outside its home market of Hong Kong, Global Bio-chem Tech needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

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Global Bio-chem Tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Global Bio-chem Tech are -

Using analytics as competitive advantage

– Global Bio-chem Tech has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Food Processing sector. This continuous investment in analytics has enabled Global Bio-chem Tech to build a competitive advantage using analytics. The analytics driven competitive advantage can help Global Bio-chem Tech to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Global Bio-chem Tech 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 Global Bio-chem Tech to hire the very best people irrespective of their geographical location.

Better consumer reach

– The expansion of the 5G network will help Global Bio-chem Tech to increase its market reach. Global Bio-chem Tech 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Global Bio-chem Tech is facing challenges because of the dominance of functional experts in the organization. Global Bio-chem Tech can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Global Bio-chem Tech can use these opportunities to build new business models that can help the communities that Global Bio-chem Tech operates in. Secondly it can use opportunities from government spending in Food Processing sector.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. Global Bio-chem Tech can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Global Bio-chem Tech can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Food Processing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Global Bio-chem Tech 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. Global Bio-chem Tech 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Global Bio-chem Tech in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.

Low interest rates

– Even though inflation is raising its head in most developed economies, Global Bio-chem Tech 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.

Manufacturing automation

– Global Bio-chem Tech can use the latest technology developments to improve its manufacturing and designing process in Food Processing 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.

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 Global Bio-chem Tech 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

– Global Bio-chem Tech 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.

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Threats Global Bio-chem Tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Global Bio-chem Tech are -

Easy access to finance

– Easy access to finance in Food Processing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Global Bio-chem Tech 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 Global Bio-chem Tech in Food Processing industry. The Food Processing 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.

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. Global Bio-chem Tech needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.

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 Global Bio-chem Tech.

Technology acceleration in Forth Industrial Revolution

– Global Bio-chem Tech has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, Global Bio-chem Tech needs to keep up with the evolution of technology in the Food Processing 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.

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 Global Bio-chem Tech in the Food Processing sector and impact the bottomline of the organization.

Regulatory challenges

– Global Bio-chem Tech 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 Food Processing industry regulations.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Global Bio-chem Tech 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 Global Bio-chem Tech prominent markets.

Increasing wage structure of Global Bio-chem Tech

– 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 Global Bio-chem Tech.

Shortening product life cycle

– it is one of the major threat that Global Bio-chem Tech is facing in Food Processing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Environmental challenges

– Global Bio-chem Tech 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. Global Bio-chem Tech can take advantage of this fund but it will also bring new competitors in the Food Processing industry.

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.

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.

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Weighted SWOT Analysis of Global Bio-chem Tech Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Global Bio-chem Tech 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 Global Bio-chem Tech 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 Global Bio-chem Tech 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 Global Bio-chem Tech 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 Global Bio-chem Tech needs to make to build a sustainable competitive advantage.

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