Case Study Description of ASICS: Chasing a 2020 Vision
In early 2016, Motoi Oyama, president and CEO of ASICS, a major sports apparel and footwear manufacturer based in Japan, lays out his company's growth plan for the upcoming 5 years. The new plan set ambitious goals in terms of revenue and profit increases. At the heart of the strategy to achieve these goals are a desire to embrace a more direct to consumer mindset, expand into new customer segments, and communicate a more consistent and emotional brand worldwide. With its primary core customer currently the "serious" runner and its innovation strategy geared towards high-end performance, pursuing these objectives in light of the fierce competitive landscape posed a multitude of challenges. Moreover, the company had recently launched several lifestyle brands (using brand names it had revived), which posed brand architecture issues. Lastly, the company had just acquired a digital fitness app, RunKeeper, and was wondering how best to leverage this asset and how it fit with the main pillars of the growth plan strategy. The Tokyo 2020 Olympic Games would coincide with the conclusion of the 5 year plan, and ASICS had paid over $100 million to be a Gold Sponsor of the games- Oyama wondered whether his company was on the right track to achieving the goals he intimated to shareholders.
Swot Analysis of "ASICS: Chasing a 2020 Vision" written by Elie Ofek, Nobuo Sato, Akiko Kanno includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Asics Oyama facing as an external strategic factors. Some of the topics covered in ASICS: Chasing a 2020 Vision case study are - Strategic Management Strategies, Change management, Competition, IT and Sales & Marketing.
Some of the macro environment factors that can be used to understand the ASICS: Chasing a 2020 Vision casestudy better are - – challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, increasing energy prices, supply chains are disrupted by pandemic , increasing transportation and logistics costs, cloud computing is disrupting traditional business models,
talent flight as more people leaving formal jobs, increasing commodity prices, etc
Introduction to SWOT Analysis of ASICS: Chasing a 2020 Vision
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ASICS: Chasing a 2020 Vision case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Asics Oyama, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Asics Oyama 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 ASICS: Chasing a 2020 Vision can be done for the following purposes –
1. Strategic planning using facts provided in ASICS: Chasing a 2020 Vision case study
2. Improving business portfolio management of Asics Oyama
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Asics Oyama
Strengths ASICS: Chasing a 2020 Vision | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Asics Oyama in ASICS: Chasing a 2020 Vision Harvard Business Review case study are -
Ability to lead change in Sales & Marketing field
– Asics Oyama is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Asics Oyama in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the ASICS: Chasing a 2020 Vision Harvard Business Review case study comprises – understanding the underlying the factors in the 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.
Strong track record of project management
– Asics Oyama is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Asics Oyama is one of the leading recruiters in the industry. Managers in the ASICS: Chasing a 2020 Vision are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Asics Oyama has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ASICS: Chasing a 2020 Vision Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Successful track record of launching new products
– Asics Oyama has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Asics Oyama 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Asics Oyama digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Asics Oyama 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 Asics Oyama in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Asics Oyama in the sector have low bargaining power. ASICS: Chasing a 2020 Vision has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Asics Oyama to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Asics Oyama 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.
Cross disciplinary teams
– Horizontal connected teams at the Asics Oyama 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.
Organizational Resilience of Asics Oyama
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Asics Oyama does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses ASICS: Chasing a 2020 Vision | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ASICS: Chasing a 2020 Vision are -
High cash cycle compare to competitors
Asics Oyama has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ASICS: Chasing a 2020 Vision, in the dynamic environment Asics Oyama has struggled to respond to the nimble upstart competition. Asics Oyama has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Asics Oyama is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study ASICS: Chasing a 2020 Vision can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Asics Oyama has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - ASICS: Chasing a 2020 Vision should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Asics Oyama 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.
Need for greater diversity
– Asics Oyama 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 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 Asics Oyama supply chain. Even after few cautionary changes mentioned in the HBR case study - ASICS: Chasing a 2020 Vision, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Asics Oyama vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Asics Oyama products
– To increase the profitability and margins on the products, Asics Oyama needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study ASICS: Chasing a 2020 Vision, is just above the industry average. Asics Oyama 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 Asics Oyama, firm in the HBR case study ASICS: Chasing a 2020 Vision needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Asics Oyama 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.
Opportunities ASICS: Chasing a 2020 Vision | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study ASICS: Chasing a 2020 Vision are -
Learning at scale
– Online learning technologies has now opened space for Asics Oyama 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.
Buying journey improvements
– Asics Oyama can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. ASICS: Chasing a 2020 Vision suggest that firm 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Asics Oyama 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 Asics Oyama to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Asics Oyama can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Asics Oyama is facing challenges because of the dominance of functional experts in the organization. ASICS: Chasing a 2020 Vision case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Asics Oyama has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study ASICS: Chasing a 2020 Vision - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Asics Oyama 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 Asics Oyama can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Asics Oyama 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.
Manufacturing automation
– Asics Oyama can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. 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.
Building a culture of innovation
– managers at Asics Oyama 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 Sales & Marketing segment.
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. Asics Oyama can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Asics Oyama 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 Asics Oyama has opened avenues for new revenue streams for the organization in the industry. This can help Asics Oyama to build a more holistic ecosystem as suggested in the ASICS: Chasing a 2020 Vision case study. Asics Oyama can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats ASICS: Chasing a 2020 Vision External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ASICS: Chasing a 2020 Vision are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Asics Oyama with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Asics Oyama
– 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 Asics Oyama.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study ASICS: Chasing a 2020 Vision, Asics Oyama may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
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 Asics Oyama business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Asics Oyama 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.
Environmental challenges
– Asics Oyama 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. Asics Oyama can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Asics Oyama 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 prominent markets illustrated in HBR case study ASICS: Chasing a 2020 Vision .
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.
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 Asics Oyama.
Shortening product life cycle
– it is one of the major threat that Asics Oyama is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Asics Oyama 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.
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 Asics Oyama in the Sales & Marketing sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Asics Oyama can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of ASICS: Chasing a 2020 Vision Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study ASICS: Chasing a 2020 Vision 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 the case study ASICS: Chasing a 2020 Vision 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 the Harvard case study ASICS: Chasing a 2020 Vision 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 ASICS: Chasing a 2020 Vision is 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 Asics Oyama needs to make to build a sustainable competitive advantage.
