SWOT Analysis
Strength
Finance
New Oriental has maintained an average growth of 38% for revenue and 25% for profit in the past three years. In the financial year of 2011, its profit increased by 30.8% to 101.8 million USD.
Reputation
Statistics show that 75% Chinese students who are currently studying abroad in America and Canada had attended NOG before, and other lots of facts show students' succeed after they received education from NOG. It is selected among the top 20 Education Groups of 2010, No.94 of Top 500 Chinese Brands.
Faculty
NOG has a young, energetic well-educated and creative faculty team. Executive President Chen Xiangdong is selected as Excellent Chinese Managers of 2011.
Coverage
So Far, NOG has 53 branches all over the world. Its business covers language education, professional skills education, studying abroad advisory, publishing, etc.
Leadership
Yu Minhong, President of NOG, is a Chinese version of Jobs. He is the spiritual leader of the youth. He is selected as the Excellent Educator of China in 2010.
Weakness
Financial Experience
NOG is not experienced in financial aspect. Recently, NOG failed in the merger and acquisition of Shanghai Green Light Education Group, which resulted in the quick fall of its shareprice.
Structure
The headquarter could not control or quick response to the branches’ changes. The fluidity of faculties lead to a significant increase in training cost and more difficulties in quality control and brand construction.
Product Lines
NOG’s product lines are too broad and less focused. This weakens its competitive strength of its major business.
Leadership
NOG relies too much on Yu’s personal fame and image.
Opportunities
Potential market needs: Studying abroad; professional skills; child education
New Oriental University: NOG is investing in opening a NOU in Beijing, aiming at providing best business, humanities and social science in China.
Threats
Chinese corporations’ bad performance in US stock change decreased investors’ confidence in Chinese stocks.
Intense competition.
Lack of government’s support on private schools and education.
Third parties accused NOG of pirating textbooks and violating rules.
Test organizations: the tests’ changes may lead the reduction of NOG’s advantages.
2. Management Team Visibility And Credibility
1) Prepare management team to be more involved with pre-and-post
earnings messaging.
2) Continue to push strategic importance of IR to management and Board
through summaries of reports and special programs.
3) Secure at least one article of interviewing Minhong Yu, the CEO of
New Oriental on Wall Street Journal.
4) Conduct media training to prepare CEO and CFO for every earnings
call and investment conference.
3. Materials Creation/Upgrade
1) Increase financial media coverage.
2) Improve IR website.
3) Create a corporation video dedicated to investors.
4) Create a comprehensive Investor Kit, including: fact sheet, press
releases, annual report and other promotion documents.
5) Create a dynamic FAQ section.
6) Upload earnings call and edit earnings call script
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