The Japanese Software Industry: What Went Wrong and What Can We Learn from It? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Japanese Software Industry: What Went Wrong and What Can We Learn from It?
Recent findings indicate that the Japanese IT sector increasingly lags the U.S. IT sector in software innovation and that this underlies Japan's weakening competitive performance vis-A?-vis U.S. IT. This article explores alternative explanations for this outcome and analyzes what explains the Japanese software industry's trajectory. The sources are found in the late understanding of the transformational role of software and its value-creating potential as well as in the evolution of the industry's structure. Finally, this article considers what policy makers in other nations might learn from the Japanese experience in building a more vibrant software industry.
Swot Analysis of "The Japanese Software Industry: What Went Wrong and What Can We Learn from It?" written by Robert E. Cole, Yoshifumi Nakata includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Japanese Software facing as an external strategic factors. Some of the topics covered in The Japanese Software Industry: What Went Wrong and What Can We Learn from It? case study are - Strategic Management Strategies, Strategic planning and Technology & Operations.
Some of the macro environment factors that can be used to understand the The Japanese Software Industry: What Went Wrong and What Can We Learn from It? casestudy better are - – increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, there is backlash against globalization, talent flight as more people leaving formal jobs, technology disruption, increasing energy prices,
there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of The Japanese Software Industry: What Went Wrong and What Can We Learn from It?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Japanese Software Industry: What Went Wrong and What Can We Learn from It? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Japanese Software, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Japanese Software 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? can be done for the following purposes –
1. Strategic planning using facts provided in The Japanese Software Industry: What Went Wrong and What Can We Learn from It? case study
2. Improving business portfolio management of Japanese Software
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 Japanese Software
Strengths The Japanese Software Industry: What Went Wrong and What Can We Learn from It? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Japanese Software in The Japanese Software Industry: What Went Wrong and What Can We Learn from It? Harvard Business Review case study are -
Ability to lead change in Technology & Operations field
– Japanese Software is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Japanese Software in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Japanese Software is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Japanese Software
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Japanese Software does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the The Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Technology & Operations industry
– The Japanese Software Industry: What Went Wrong and What Can We Learn from It? firm has clearly differentiated products in the market place. This has enabled Japanese Software to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Japanese Software to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Japanese Software 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? - 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
– Japanese Software has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Japanese Software to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Japanese Software is one of the most innovative firm in sector. Manager in The Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Japanese Software digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Japanese Software 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.
Learning organization
- Japanese Software is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Japanese Software is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Japanese Software Industry: What Went Wrong and What Can We Learn from It? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Japanese Software has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Japanese Software 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 The Japanese Software Industry: What Went Wrong and What Can We Learn from It? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Japanese Software Industry: What Went Wrong and What Can We Learn from It? are -
Slow decision making process
– As mentioned earlier in the report, Japanese Software 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. Japanese Software 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 operating costs
– Compare to the competitors, firm in the HBR case study The Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Japanese Software is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Japanese Software Industry: What Went Wrong and What Can We Learn from It? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Japanese Software Industry: What Went Wrong and What Can We Learn from It?, it seems that the employees of Japanese Software 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.
Products dominated business model
– Even though Japanese Software 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Japanese Software 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.
Skills based hiring
– The stress on hiring functional specialists at Japanese Software has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert E. Cole, Yoshifumi Nakata suggests that, Japanese Software 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.
Lack of clear differentiation of Japanese Software products
– To increase the profitability and margins on the products, Japanese Software needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Japanese Software Industry: What Went Wrong and What Can We Learn from It?, in the dynamic environment Japanese Software has struggled to respond to the nimble upstart competition. Japanese Software has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Japanese Software 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.
Opportunities The Japanese Software Industry: What Went Wrong and What Can We Learn from It? | 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? are -
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 Japanese Software in the consumer business. Now Japanese Software can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Japanese Software 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Japanese Software to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Japanese Software 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.
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. Japanese Software 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. Japanese Software 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Japanese Software 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It?, 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 Technology & Operations industry, but it has also influenced the consumer preferences. Japanese Software can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Japanese Software 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.
Leveraging digital technologies
– Japanese Software 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Japanese Software 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Japanese Software 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 Japanese Software 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 Japanese Software to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Japanese Software can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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.
Loyalty marketing
– Japanese Software 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.
Threats The Japanese Software Industry: What Went Wrong and What Can We Learn from It? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Japanese Software Industry: What Went Wrong and What Can We Learn from It? are -
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 Japanese Software.
Consumer confidence and its impact on Japanese Software 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.
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.
Increasing wage structure of Japanese Software
– 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 Japanese Software.
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 Japanese Software in the Technology & Operations sector and impact the bottomline of the organization.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Japanese Software needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Japanese Software can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Japanese Software business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Japanese Software with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Japanese Software is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Japanese Software has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Japanese Software needs to keep up with the evolution of technology in the Technology & Operations 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.
High dependence on third party suppliers
– Japanese Software 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.
Weighted SWOT Analysis of The Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software Industry: What Went Wrong and What Can We Learn from It? 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 Japanese Software needs to make to build a sustainable competitive advantage.
