The Great East Japan Earthquake B: Fast Retailing Group's Response SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Great East Japan Earthquake B: Fast Retailing Group's Response
Few hours after the earthquake hit on March 11, 2011, CEO Tadashi Yanai of Fast Retailing was eating sushi at a restaurant near his office. He was confident that his store managers would be able to decide for themselves the best action to take in midst of this crisis. Some of the pending decisions were whether or not to reopen the UNIQLO stores that were wiped out by the tsunami, to follow government orders to turn off the store lights, and to distribute warm clothing in the devastated areas.
Authors :: Hirotaka Takeuchi, Kenichi Nonomura, Dena Neuenschwander, Meghan Ricci
Swot Analysis of "The Great East Japan Earthquake B: Fast Retailing Group's Response" written by Hirotaka Takeuchi, Kenichi Nonomura, Dena Neuenschwander, Meghan Ricci includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Earthquake Retailing facing as an external strategic factors. Some of the topics covered in The Great East Japan Earthquake B: Fast Retailing Group's Response case study are - Strategic Management Strategies, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the The Great East Japan Earthquake B: Fast Retailing Group's Response casestudy better are - – central banks are concerned over increasing inflation, technology disruption, increasing energy prices, increasing commodity prices, there is backlash against globalization, talent flight as more people leaving formal jobs, geopolitical disruptions,
increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of The Great East Japan Earthquake B: Fast Retailing Group's Response
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Great East Japan Earthquake B: Fast Retailing Group's Response case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Earthquake Retailing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Earthquake Retailing 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 The Great East Japan Earthquake B: Fast Retailing Group's Response can be done for the following purposes –
1. Strategic planning using facts provided in The Great East Japan Earthquake B: Fast Retailing Group's Response case study
2. Improving business portfolio management of Earthquake Retailing
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 Earthquake Retailing
Strengths The Great East Japan Earthquake B: Fast Retailing Group's Response | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Earthquake Retailing in The Great East Japan Earthquake B: Fast Retailing Group's Response Harvard Business Review case study are -
Sustainable margins compare to other players in Strategy & Execution industry
– The Great East Japan Earthquake B: Fast Retailing Group's Response firm has clearly differentiated products in the market place. This has enabled Earthquake Retailing to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Earthquake Retailing to invest into research and development (R&D) and innovation.
Analytics focus
– Earthquake Retailing 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 Hirotaka Takeuchi, Kenichi Nonomura, Dena Neuenschwander, Meghan Ricci 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.
Cross disciplinary teams
– Horizontal connected teams at the Earthquake Retailing 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.
Superior customer experience
– The customer experience strategy of Earthquake Retailing in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Earthquake Retailing has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Earthquake Retailing to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Earthquake Retailing 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 The Great East Japan Earthquake B: Fast Retailing Group's Response - 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
– Earthquake Retailing has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Great East Japan Earthquake B: Fast Retailing Group's Response 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 switching costs
– The high switching costs that Earthquake Retailing 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Earthquake Retailing digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Earthquake Retailing 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.
Successful track record of launching new products
– Earthquake Retailing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Earthquake Retailing 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.
Highly skilled collaborators
– Earthquake Retailing 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 The Great East Japan Earthquake B: Fast Retailing Group's Response HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Earthquake Retailing is present in almost all the verticals within the industry. This has provided firm in The Great East Japan Earthquake B: Fast Retailing Group's Response 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.
Weaknesses The Great East Japan Earthquake B: Fast Retailing Group's Response | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Great East Japan Earthquake B: Fast Retailing Group's Response are -
Products dominated business model
– Even though Earthquake Retailing 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 - The Great East Japan Earthquake B: Fast Retailing Group's Response 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 The Great East Japan Earthquake B: Fast Retailing Group's Response 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 The Great East Japan Earthquake B: Fast Retailing Group's Response can leverage the sales team experience to cultivate customer relationships as Earthquake Retailing is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Great East Japan Earthquake B: Fast Retailing Group's Response, it seems that the employees of Earthquake Retailing 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, Earthquake Retailing 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the The Great East Japan Earthquake B: Fast Retailing Group's Response 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 Earthquake Retailing has relatively successful track record of launching new products.
Lack of clear differentiation of Earthquake Retailing products
– To increase the profitability and margins on the products, Earthquake Retailing needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the segment, Earthquake Retailing 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.
High operating costs
– Compare to the competitors, firm in the HBR case study The Great East Japan Earthquake B: Fast Retailing Group's Response 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 Earthquake Retailing 's lucrative customers.
Slow to strategic competitive environment developments
– As The Great East Japan Earthquake B: Fast Retailing Group's Response HBR case study mentions - Earthquake Retailing 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.
No frontier risks strategy
– After analyzing the HBR case study The Great East Japan Earthquake B: Fast Retailing Group's Response, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Need for greater diversity
– Earthquake Retailing 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 The Great East Japan Earthquake B: Fast Retailing Group's Response | 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 The Great East Japan Earthquake B: Fast Retailing Group's Response are -
Leveraging digital technologies
– Earthquake Retailing 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.
Using analytics as competitive advantage
– Earthquake Retailing 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 The Great East Japan Earthquake B: Fast Retailing Group's Response - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Earthquake Retailing to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Earthquake Retailing 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.
Better consumer reach
– The expansion of the 5G network will help Earthquake Retailing to increase its market reach. Earthquake Retailing 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Earthquake Retailing can use these opportunities to build new business models that can help the communities that Earthquake Retailing operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Earthquake Retailing 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, The Great East Japan Earthquake B: Fast Retailing Group's Response, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Earthquake Retailing 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 Earthquake Retailing has opened avenues for new revenue streams for the organization in the industry. This can help Earthquake Retailing to build a more holistic ecosystem as suggested in the The Great East Japan Earthquake B: Fast Retailing Group's Response case study. Earthquake Retailing can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Earthquake Retailing 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Earthquake Retailing can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Earthquake Retailing in the consumer business. Now Earthquake Retailing can target international markets with far fewer capital restrictions requirements than the existing system.
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. Earthquake Retailing can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Earthquake Retailing is facing challenges because of the dominance of functional experts in the organization. The Great East Japan Earthquake B: Fast Retailing Group's Response 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.
Threats The Great East Japan Earthquake B: Fast Retailing Group's Response External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Great East Japan Earthquake B: Fast Retailing Group's Response are -
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Earthquake Retailing 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.
Technology acceleration in Forth Industrial Revolution
– Earthquake Retailing has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Earthquake Retailing needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Consumer confidence and its impact on Earthquake Retailing 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.
Shortening product life cycle
– it is one of the major threat that Earthquake Retailing is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Earthquake Retailing 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 The Great East Japan Earthquake B: Fast Retailing Group's Response .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The Great East Japan Earthquake B: Fast Retailing Group's Response, Earthquake Retailing 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Earthquake Retailing with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Earthquake Retailing in the Strategy & Execution sector and impact the bottomline of the organization.
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 Earthquake Retailing business can come under increasing regulations regarding data privacy, data security, etc.
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.
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 Earthquake Retailing.
Regulatory challenges
– Earthquake Retailing 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.
Weighted SWOT Analysis of The Great East Japan Earthquake B: Fast Retailing Group's Response 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 The Great East Japan Earthquake B: Fast Retailing Group's Response 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 The Great East Japan Earthquake B: Fast Retailing Group's Response 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 The Great East Japan Earthquake B: Fast Retailing Group's Response 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 The Great East Japan Earthquake B: Fast Retailing Group's Response 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 Earthquake Retailing needs to make to build a sustainable competitive advantage.
