Sony Digital Entertainment, Japan SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Sony Digital Entertainment, Japan
It is late 2007. So-called cell phone ("keitai") novels have turned into an extremely popular form of entertainment on the go in Japan, in particular among young, female readers. In fact, consisting mostly of love stories written by amateurs in short sentences and containing little plot or character development, cell phone novels republished in book form and even remade as movies have come to dominate mainstream media content. At media giant Sony, Ken Munekata, CEO of Sony Pictures Entertainment (SPE), and Atsushi Fukuda, President of Sony Digital Entertainment (SDE), are attempting to craft an adequate response. After establishing SDE as a 100% subsidiary of Sony Japan, they now develop a wide range of digital content offerings for mobile phone users, mostly original content "made in Japan"-including keitai novels. But can SDE's subscription model compete in a market dominated by free keitai novel offerings? And, more generally, do Sony's current keitai initiatives move the company in the right strategic direction? Allows for an in-depth examination of viable business models for established media companies competing in digital markets dominated by user-generated, advertising-supported content. Also enables an assessment of the economics of producing and distributing traditional films and books versus digital (cell phone) content.
Swot Analysis of "Sony Digital Entertainment, Japan" written by Anita Elberse includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Keitai Sony facing as an external strategic factors. Some of the topics covered in Sony Digital Entertainment, Japan case study are - Strategic Management Strategies, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Sony Digital Entertainment, Japan casestudy better are - – increasing transportation and logistics costs, talent flight as more people leaving formal jobs, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, wage bills are increasing,
increasing commodity prices, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Sony Digital Entertainment, Japan
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sony Digital Entertainment, Japan case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Keitai Sony, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Keitai Sony 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 Sony Digital Entertainment, Japan can be done for the following purposes –
1. Strategic planning using facts provided in Sony Digital Entertainment, Japan case study
2. Improving business portfolio management of Keitai Sony
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 Keitai Sony
Strengths Sony Digital Entertainment, Japan | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Keitai Sony in Sony Digital Entertainment, Japan Harvard Business Review case study are -
Highly skilled collaborators
– Keitai Sony has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Sony Digital Entertainment, Japan HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Keitai Sony has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Keitai Sony 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.
Superior customer experience
– The customer experience strategy of Keitai Sony in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Sales & Marketing field
– Keitai Sony 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 Keitai Sony in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Keitai Sony 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.
Effective Research and Development (R&D)
– Keitai Sony has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Sony Digital Entertainment, Japan - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Keitai Sony 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 Keitai Sony is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Sony Digital Entertainment, Japan Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Keitai Sony is one of the leading recruiters in the industry. Managers in the Sony Digital Entertainment, Japan are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Sales & Marketing industry
– Sony Digital Entertainment, Japan firm has clearly differentiated products in the market place. This has enabled Keitai Sony to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Keitai Sony to invest into research and development (R&D) and innovation.
Training and development
– Keitai Sony has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Sony Digital Entertainment, Japan 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.
High brand equity
– Keitai Sony has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Keitai Sony to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Keitai Sony is one of the most innovative firm in sector. Manager in Sony Digital Entertainment, Japan Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Sony Digital Entertainment, Japan | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sony Digital Entertainment, Japan are -
Increasing silos among functional specialists
– The organizational structure of Keitai Sony is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Keitai Sony needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Keitai Sony to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Sony Digital Entertainment, Japan, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. 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.
Products dominated business model
– Even though Keitai Sony 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 - Sony Digital Entertainment, Japan should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study Sony Digital Entertainment, Japan that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Sony Digital Entertainment, Japan can leverage the sales team experience to cultivate customer relationships as Keitai Sony is planning to shift buying processes online.
Lack of clear differentiation of Keitai Sony products
– To increase the profitability and margins on the products, Keitai Sony needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Sony Digital Entertainment, Japan, in the dynamic environment Keitai Sony has struggled to respond to the nimble upstart competition. Keitai Sony has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Sony Digital Entertainment, Japan has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Keitai Sony 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Keitai Sony 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Keitai Sony is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Sony Digital Entertainment, Japan can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Sony Digital Entertainment, Japan, it seems that the employees of Keitai Sony 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.
Interest costs
– Compare to the competition, Keitai Sony 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 Sony Digital Entertainment, Japan | 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 Sony Digital Entertainment, Japan are -
Learning at scale
– Online learning technologies has now opened space for Keitai Sony 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Keitai Sony 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 Keitai Sony to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Keitai Sony is facing challenges because of the dominance of functional experts in the organization. Sony Digital Entertainment, Japan 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.
Leveraging digital technologies
– Keitai Sony 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Keitai Sony in the consumer business. Now Keitai Sony can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Keitai Sony to increase its market reach. Keitai Sony 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Keitai Sony in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
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. Keitai Sony can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Keitai Sony can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Sony Digital Entertainment, Japan 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Keitai Sony 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 Keitai Sony has opened avenues for new revenue streams for the organization in the industry. This can help Keitai Sony to build a more holistic ecosystem as suggested in the Sony Digital Entertainment, Japan case study. Keitai Sony can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Keitai Sony 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.
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 Keitai Sony 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.
Threats Sony Digital Entertainment, Japan External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sony Digital Entertainment, Japan are -
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 Keitai Sony in the Sales & Marketing sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Sony Digital Entertainment, Japan, Keitai Sony 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 .
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Keitai Sony with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Keitai Sony in the Sales & Marketing industry. The Sales & Marketing 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 dependence on third party suppliers
– Keitai Sony 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.
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. Keitai Sony 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.
Consumer confidence and its impact on Keitai Sony 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 the industry and other sectors.
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 Keitai Sony business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Keitai Sony
– 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 Keitai Sony.
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.
Shortening product life cycle
– it is one of the major threat that Keitai Sony is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Keitai Sony needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Sony Digital Entertainment, Japan 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 Sony Digital Entertainment, Japan 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 Sony Digital Entertainment, Japan 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 Sony Digital Entertainment, Japan 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 Sony Digital Entertainment, Japan 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 Keitai Sony needs to make to build a sustainable competitive advantage.
