Recruit Japan: Harnessing Data to Create Value (Abridged) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Recruit Japan: Harnessing Data to Create Value (Abridged)
Recruit Holdings, Japan's largest staffing firm and a leading marketing media company started out in the early 1960s as an advertising company publishing magazines for jobseekers. It scaled up over the following decades to add business verticals such as real estate, bridal, travel, beauty salons and restaurants. Spurred by the internet revolution in the early 2000s, Recruit launched job boards and websites for its diverse media businesses while also moving content online by digitizing many of its popular magazines. In the early 2010s, it transitioned into becoming a service provider with the launch of a number of web-based platforms that allowed SMEs to digitize several key activities, such as point-of-sale registers, reservations and payments. By 2015 Recruit's digital platforms had gained significant popularity and the company was generating enormous amounts of online data on types of transactions, end-user behaviors and SME business characteristics. It also held significant deep offline data that resided within the sales team. However, the platforms and the data was specific to individual businesses. Recruit began to push for a unified backbone platform that would cut across all businesses with vertically stacked integrated solutions. It also established an artificial intelligence (AI) research laboratory in Silicon Valley. The mandate was to apply the latest technologies in data analytics, machine learning and AI to achieve breakthrough innovation. At the same time, Recruit harbored global aspirations and embarked on international expansion, mainly through acquisitions. Its goal was to become the world's largest staffing firm by 2020 and the largest media company by 2030. Could Recruit replicate its business model successfully overseas? Could it leverage its people and technological platforms to transform itself into a truly global internet corporation? Could it cannibalize its existing businesses through data-driven innovations to leapfrog into the future?
Authors :: Howard H. Yu, Thomas W. Malnight, Ivy Buche
Swot Analysis of "Recruit Japan: Harnessing Data to Create Value (Abridged)" written by Howard H. Yu, Thomas W. Malnight, Ivy Buche includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Recruit Platforms facing as an external strategic factors. Some of the topics covered in Recruit Japan: Harnessing Data to Create Value (Abridged) case study are - Strategic Management Strategies, Innovation, IT, Marketing and Technology & Operations.
Some of the macro environment factors that can be used to understand the Recruit Japan: Harnessing Data to Create Value (Abridged) casestudy better are - – increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing,
technology disruption, geopolitical disruptions, etc
Introduction to SWOT Analysis of Recruit Japan: Harnessing Data to Create Value (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Recruit Japan: Harnessing Data to Create Value (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Recruit Platforms, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Recruit Platforms 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 Recruit Japan: Harnessing Data to Create Value (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in Recruit Japan: Harnessing Data to Create Value (Abridged) case study
2. Improving business portfolio management of Recruit Platforms
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Recruit Platforms
Strengths Recruit Japan: Harnessing Data to Create Value (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Recruit Platforms in Recruit Japan: Harnessing Data to Create Value (Abridged) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Recruit Platforms in the sector have low bargaining power. Recruit Japan: Harnessing Data to Create Value (Abridged) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Recruit Platforms to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Recruit Platforms in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Recruit Platforms
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Recruit Platforms does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Technology & Operations industry
– Recruit Japan: Harnessing Data to Create Value (Abridged) firm has clearly differentiated products in the market place. This has enabled Recruit Platforms to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Recruit Platforms to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Recruit Platforms 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.
Effective Research and Development (R&D)
– Recruit Platforms 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 Recruit Japan: Harnessing Data to Create Value (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.
Analytics focus
– Recruit Platforms 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 Howard H. Yu, Thomas W. Malnight, Ivy Buche 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.
Highly skilled collaborators
– Recruit Platforms 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 Recruit Japan: Harnessing Data to Create Value (Abridged) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Recruit Platforms has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Recruit Japan: Harnessing Data to Create Value (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.
High brand equity
– Recruit Platforms has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Recruit Platforms to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Recruit Platforms is present in almost all the verticals within the industry. This has provided firm in Recruit Japan: Harnessing Data to Create Value (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.
Successful track record of launching new products
– Recruit Platforms has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Recruit Platforms 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.
Weaknesses Recruit Japan: Harnessing Data to Create Value (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Recruit Japan: Harnessing Data to Create Value (Abridged) are -
Products dominated business model
– Even though Recruit Platforms 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 - Recruit Japan: Harnessing Data to Create Value (Abridged) should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Recruit Platforms 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.
No frontier risks strategy
– After analyzing the HBR case study Recruit Japan: Harnessing Data to Create Value (Abridged), it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Recruit Platforms 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 Recruit Japan: Harnessing Data to Create Value (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 Recruit Platforms 's lucrative customers.
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 Recruit Platforms supply chain. Even after few cautionary changes mentioned in the HBR case study - Recruit Japan: Harnessing Data to Create Value (Abridged), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Recruit Platforms vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Recruit Japan: Harnessing Data to Create Value (Abridged), in the dynamic environment Recruit Platforms has struggled to respond to the nimble upstart competition. Recruit Platforms has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Recruit Japan: Harnessing Data to Create Value (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 Recruit Platforms has relatively successful track record of launching new products.
Need for greater diversity
– Recruit Platforms 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.
Lack of clear differentiation of Recruit Platforms products
– To increase the profitability and margins on the products, Recruit Platforms needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Recruit Japan: Harnessing Data to Create Value (Abridged) HBR case study mentions - Recruit Platforms 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.
Opportunities Recruit Japan: Harnessing Data to Create Value (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 Recruit Japan: Harnessing Data to Create Value (Abridged) are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Recruit Platforms can use these opportunities to build new business models that can help the communities that Recruit Platforms operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Loyalty marketing
– Recruit Platforms 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.
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. Recruit Platforms can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Recruit Platforms can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Recruit Platforms can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Learning at scale
– Online learning technologies has now opened space for Recruit Platforms 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.
Building a culture of innovation
– managers at Recruit Platforms 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 Technology & Operations segment.
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 Recruit Platforms 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Recruit Platforms 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 Recruit Platforms 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 Recruit Platforms to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Recruit Platforms in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Recruit Platforms 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, Recruit Japan: Harnessing Data to Create Value (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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Recruit Platforms can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Recruit Platforms has opened avenues for new revenue streams for the organization in the industry. This can help Recruit Platforms to build a more holistic ecosystem as suggested in the Recruit Japan: Harnessing Data to Create Value (Abridged) case study. Recruit Platforms can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Recruit Japan: Harnessing Data to Create Value (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Recruit Japan: Harnessing Data to Create Value (Abridged) are -
Stagnating economy with rate increase
– Recruit Platforms 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 Recruit Platforms in the Technology & Operations industry. The Technology & Operations 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.
Increasing wage structure of Recruit Platforms
– 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 Recruit Platforms.
High dependence on third party suppliers
– Recruit Platforms 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.
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.
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 Recruit Platforms.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Recruit Japan: Harnessing Data to Create Value (Abridged), Recruit Platforms may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Consumer confidence and its impact on Recruit Platforms 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.
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 Recruit Platforms in the Technology & Operations sector and impact the bottomline of the organization.
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. Recruit Platforms 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.
Environmental challenges
– Recruit Platforms 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. Recruit Platforms can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Shortening product life cycle
– it is one of the major threat that Recruit Platforms is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Recruit Japan: Harnessing Data to Create Value (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 Recruit Japan: Harnessing Data to Create Value (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 Recruit Japan: Harnessing Data to Create Value (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 Recruit Japan: Harnessing Data to Create Value (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 Recruit Japan: Harnessing Data to Create Value (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 Recruit Platforms needs to make to build a sustainable competitive advantage.