All Nippon Airways: Are Dual Business Models Sustainable? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of All Nippon Airways: Are Dual Business Models Sustainable?
In 2012, All Nippon Airways diversified into Japan's emerging low-cost carrier market by launching two new low-cost carriers: Peach Aviation and AirAsia Japan. After one year, Peach Aviation experienced financial losses and operations failures; after two years, the company announced cancellation of many flights. The second carrier, AirAsia Japan, ended its operations in 2013, and was later restructured as Vanilla Air, a wholly-owned subsidiary of All Nippon Airways. Why was a highly successful flag and legacy carrier unable to successfully run a low-cost carrier in Japan? Elise Perrin is affiliated with Nagoya University of Commerce and Business.
Swot Analysis of "All Nippon Airways: Are Dual Business Models Sustainable?" written by Wiboon Kittilaksanawong, Elise Perrin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Carrier Nippon facing as an external strategic factors. Some of the topics covered in All Nippon Airways: Are Dual Business Models Sustainable? case study are - Strategic Management Strategies, Risk management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the All Nippon Airways: Are Dual Business Models Sustainable? casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic ,
increasing energy prices, geopolitical disruptions, etc
Introduction to SWOT Analysis of All Nippon Airways: Are Dual Business Models Sustainable?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in All Nippon Airways: Are Dual Business Models Sustainable? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Carrier Nippon, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Carrier Nippon 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 All Nippon Airways: Are Dual Business Models Sustainable? can be done for the following purposes –
1. Strategic planning using facts provided in All Nippon Airways: Are Dual Business Models Sustainable? case study
2. Improving business portfolio management of Carrier Nippon
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Carrier Nippon
Strengths All Nippon Airways: Are Dual Business Models Sustainable? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Carrier Nippon in All Nippon Airways: Are Dual Business Models Sustainable? Harvard Business Review case study are -
Ability to recruit top talent
– Carrier Nippon is one of the leading recruiters in the industry. Managers in the All Nippon Airways: Are Dual Business Models Sustainable? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Carrier Nippon is one of the most innovative firm in sector. Manager in All Nippon Airways: Are Dual Business Models Sustainable? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Carrier Nippon 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 All Nippon Airways: Are Dual Business Models Sustainable? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Carrier Nippon has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Carrier Nippon to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Carrier Nippon 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.
Strong track record of project management
– Carrier Nippon is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Carrier Nippon is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Wiboon Kittilaksanawong, Elise Perrin can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Successful track record of launching new products
– Carrier Nippon has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Carrier Nippon 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.
Cross disciplinary teams
– Horizontal connected teams at the Carrier Nippon 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.
Training and development
– Carrier Nippon has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in All Nippon Airways: Are Dual Business Models Sustainable? 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.
Operational resilience
– The operational resilience strategy in the All Nippon Airways: Are Dual Business Models Sustainable? 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.
Sustainable margins compare to other players in Strategy & Execution industry
– All Nippon Airways: Are Dual Business Models Sustainable? firm has clearly differentiated products in the market place. This has enabled Carrier Nippon to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Carrier Nippon to invest into research and development (R&D) and innovation.
Weaknesses All Nippon Airways: Are Dual Business Models Sustainable? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of All Nippon Airways: Are Dual Business Models Sustainable? are -
Lack of clear differentiation of Carrier Nippon products
– To increase the profitability and margins on the products, Carrier Nippon needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study All Nippon Airways: Are Dual Business Models Sustainable?, it seems that the employees of Carrier Nippon 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 star products
– The top 2 products and services of the firm as mentioned in the All Nippon Airways: Are Dual Business Models Sustainable? HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Carrier Nippon has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As All Nippon Airways: Are Dual Business Models Sustainable? HBR case study mentions - Carrier Nippon takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Need for greater diversity
– Carrier Nippon 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.
Interest costs
– Compare to the competition, Carrier Nippon 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.
Slow decision making process
– As mentioned earlier in the report, Carrier Nippon has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Carrier Nippon 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.
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 Carrier Nippon supply chain. Even after few cautionary changes mentioned in the HBR case study - All Nippon Airways: Are Dual Business Models Sustainable?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Carrier Nippon vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Wiboon Kittilaksanawong, Elise Perrin suggests that, Carrier Nippon 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 industry.
Increasing silos among functional specialists
– The organizational structure of Carrier Nippon is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Carrier Nippon needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Carrier Nippon to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Carrier Nippon 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 - All Nippon Airways: Are Dual Business Models Sustainable? should strive to include more intangible value offerings along with its core products and services.
Opportunities All Nippon Airways: Are Dual Business Models Sustainable? | 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 All Nippon Airways: Are Dual Business Models Sustainable? are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Carrier Nippon is facing challenges because of the dominance of functional experts in the organization. All Nippon Airways: Are Dual Business Models Sustainable? 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
– Carrier Nippon 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Carrier Nippon can use these opportunities to build new business models that can help the communities that Carrier Nippon operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Carrier Nippon 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.
Developing new processes and practices
– Carrier Nippon can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Manufacturing automation
– Carrier Nippon can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
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 Carrier Nippon in the consumer business. Now Carrier Nippon can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Carrier Nippon 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Carrier Nippon in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
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 Carrier Nippon 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Carrier Nippon can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Carrier Nippon can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. All Nippon Airways: Are Dual Business Models Sustainable? 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Carrier Nippon can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, All Nippon Airways: Are Dual Business Models Sustainable?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats All Nippon Airways: Are Dual Business Models Sustainable? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study All Nippon Airways: Are Dual Business Models Sustainable? are -
Shortening product life cycle
– it is one of the major threat that Carrier Nippon is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Carrier Nippon with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Carrier Nippon can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Carrier Nippon 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. Carrier Nippon can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Regulatory challenges
– Carrier Nippon 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 Strategy & Execution industry regulations.
Stagnating economy with rate increase
– Carrier Nippon 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 field.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Carrier Nippon in the Strategy & Execution industry. The Strategy & Execution 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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Carrier Nippon 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 All Nippon Airways: Are Dual Business Models Sustainable? .
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 Carrier Nippon in the Strategy & Execution sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Carrier Nippon 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. Carrier Nippon 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.
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 Carrier Nippon.
Weighted SWOT Analysis of All Nippon Airways: Are Dual Business Models Sustainable? 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 All Nippon Airways: Are Dual Business Models Sustainable? 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 All Nippon Airways: Are Dual Business Models Sustainable? 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 All Nippon Airways: Are Dual Business Models Sustainable? 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 All Nippon Airways: Are Dual Business Models Sustainable? 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 Carrier Nippon needs to make to build a sustainable competitive advantage.
