Competition in Japanese Financial Markets--2002 (Abridged) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Competition in Japanese Financial Markets--2002 (Abridged)
In early 2002, Japan, the world's largest economy, had been mired in a decade-long recession. A range of stimulus packages had failed to work their magic. The "Big Bang" financial deregulation reforms announced in 1998 had not quite produced the economic boom that the government had anticipated. Japan struggled to find its place in the increasingly global 21st century. Japan's commercial banks, once the largest in the world, struggled under the weight of their nonperforming loans. Japan's investment banks--the likes of Nomura--remained powerful behemoths. But they had scaled back their global ambitions and were in danger of being eclipsed in their own backyard by a range of foreign financial intermediaries. Meanwhile, the terrorist attack on the United States on September 11, 2001, accelerated a U.S. economic recession and raised the level of uncertainty in the global business environment across the board. It also contributed to the global investment banking industry's worst slowdown since the 1970s, with large firms recording worldwide slumps in revenues and profits of between 40% and 50%.
Swot Analysis of "Competition in Japanese Financial Markets--2002 (Abridged)" written by Tarun Khanna includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Japan's Struggled facing as an external strategic factors. Some of the topics covered in Competition in Japanese Financial Markets--2002 (Abridged) case study are - Strategic Management Strategies, Strategic planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Competition in Japanese Financial Markets--2002 (Abridged) casestudy better are - – challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion,
there is increasing trade war between United States & China, technology disruption, etc
Introduction to SWOT Analysis of Competition in Japanese Financial Markets--2002 (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Competition in Japanese Financial Markets--2002 (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Japan's Struggled, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Japan's Struggled 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 Competition in Japanese Financial Markets--2002 (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in Competition in Japanese Financial Markets--2002 (Abridged) case study
2. Improving business portfolio management of Japan's Struggled
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 Japan's Struggled
Strengths Competition in Japanese Financial Markets--2002 (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Japan's Struggled in Competition in Japanese Financial Markets--2002 (Abridged) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Japan's Struggled in the sector have low bargaining power. Competition in Japanese Financial Markets--2002 (Abridged) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Japan's Struggled to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Japan's Struggled
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Japan's Struggled does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Japan's Struggled is one of the most innovative firm in sector. Manager in Competition in Japanese Financial Markets--2002 (Abridged) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Japan's Struggled in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Japan's Struggled 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.
Highly skilled collaborators
– Japan's Struggled 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 Competition in Japanese Financial Markets--2002 (Abridged) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Strategy & Execution industry
– Competition in Japanese Financial Markets--2002 (Abridged) firm has clearly differentiated products in the market place. This has enabled Japan's Struggled to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Japan's Struggled to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Japan's Struggled has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Japan's Struggled 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.
Ability to recruit top talent
– Japan's Struggled is one of the leading recruiters in the industry. Managers in the Competition in Japanese Financial Markets--2002 (Abridged) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Japan's Struggled is present in almost all the verticals within the industry. This has provided firm in Competition in Japanese Financial Markets--2002 (Abridged) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Effective Research and Development (R&D)
– Japan's Struggled 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 Competition in Japanese Financial Markets--2002 (Abridged) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Japan's Struggled has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Competition in Japanese Financial Markets--2002 (Abridged) 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.
Weaknesses Competition in Japanese Financial Markets--2002 (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Competition in Japanese Financial Markets--2002 (Abridged) are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Competition in Japanese Financial Markets--2002 (Abridged) 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 Japan's Struggled has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Japan's Struggled 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Competition in Japanese Financial Markets--2002 (Abridged) 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 Japan's Struggled 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Competition in Japanese Financial Markets--2002 (Abridged), is just above the industry average. Japan's Struggled 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.
Products dominated business model
– Even though Japan's Struggled 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 - Competition in Japanese Financial Markets--2002 (Abridged) should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Japan's Struggled 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 industry using digital technology.
High bargaining power of channel partners
– Because of the regulatory requirements, Tarun Khanna suggests that, Japan's Struggled 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 Japan's Struggled is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Japan's Struggled needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Japan's Struggled to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Japan's Struggled 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.
Slow decision making process
– As mentioned earlier in the report, Japan's Struggled 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. Japan's Struggled 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.
Need for greater diversity
– Japan's Struggled 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.
Opportunities Competition in Japanese Financial Markets--2002 (Abridged) | 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 Competition in Japanese Financial Markets--2002 (Abridged) are -
Buying journey improvements
– Japan's Struggled can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Competition in Japanese Financial Markets--2002 (Abridged) 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Japan's Struggled can use these opportunities to build new business models that can help the communities that Japan's Struggled operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Loyalty marketing
– Japan's Struggled 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.
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 Japan's Struggled 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Japan's Struggled is facing challenges because of the dominance of functional experts in the organization. Competition in Japanese Financial Markets--2002 (Abridged) 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.
Building a culture of innovation
– managers at Japan's Struggled 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 Strategy & Execution segment.
Creating value in data economy
– The success of analytics program of Japan's Struggled has opened avenues for new revenue streams for the organization in the industry. This can help Japan's Struggled to build a more holistic ecosystem as suggested in the Competition in Japanese Financial Markets--2002 (Abridged) case study. Japan's Struggled can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Japan's Struggled 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, Competition in Japanese Financial Markets--2002 (Abridged), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Japan's Struggled can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Japan's Struggled 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 Japan's Struggled in the consumer business. Now Japan's Struggled can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Japan's Struggled 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Japan's Struggled 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 Japan's Struggled to hire the very best people irrespective of their geographical location.
Threats Competition in Japanese Financial Markets--2002 (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Competition in Japanese Financial Markets--2002 (Abridged) are -
Increasing wage structure of Japan's Struggled
– 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 Japan's Struggled.
Regulatory challenges
– Japan's Struggled 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.
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 Japan's Struggled in the Strategy & Execution 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 Competition in Japanese Financial Markets--2002 (Abridged), Japan's Struggled may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Shortening product life cycle
– it is one of the major threat that Japan's Struggled is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Japan's Struggled 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Japan's Struggled 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 Competition in Japanese Financial Markets--2002 (Abridged) .
Consumer confidence and its impact on Japan's Struggled 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Japan's Struggled 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 Japan's Struggled 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.
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 Japan's Struggled business can come under increasing regulations regarding data privacy, data security, etc.
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.
Stagnating economy with rate increase
– Japan's Struggled 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.
Weighted SWOT Analysis of Competition in Japanese Financial Markets--2002 (Abridged) 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 Competition in Japanese Financial Markets--2002 (Abridged) 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 Competition in Japanese Financial Markets--2002 (Abridged) 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 Competition in Japanese Financial Markets--2002 (Abridged) 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 Competition in Japanese Financial Markets--2002 (Abridged) 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 Japan's Struggled needs to make to build a sustainable competitive advantage.
