Asahi Kasei: Building an Inclusive Value Chain in India SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Asahi Kasei: Building an Inclusive Value Chain in India
Asahi Kasei Corporation (Asahi Kasei), a diversified company based in Japan, had partnerships with weavers in India for its cupro yarn, which was used to make traditional garments for Indian women. The company developed a unique, inclusive value chain in India and began focusing on enhancing the development impact of its operations there. With a growing market for cupro yarn in India, Asahi Kasei expanded the capacity of its production facility in Japan in 2014, even though the domestic market for the product was shrinking. However, in 2015, the product started to face intense price competition in India from viscose rayon, which was an inferior but cheaper product. In 2016, the company had to address the competitive pressures while considering its economic and social objectives. Savita Shankar is affiliated with Keio University. Masahiro Okada is affiliated with KEIO Business School.
Swot Analysis of "Asahi Kasei: Building an Inclusive Value Chain in India" written by Savita Shankar, Masahiro Okada includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kasei Asahi facing as an external strategic factors. Some of the topics covered in Asahi Kasei: Building an Inclusive Value Chain in India case study are - Strategic Management Strategies, Social responsibility and Global Business.
Some of the macro environment factors that can be used to understand the Asahi Kasei: Building an Inclusive Value Chain in India casestudy better are - – there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing transportation and logistics costs, talent flight as more people leaving formal jobs,
competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, etc
Introduction to SWOT Analysis of Asahi Kasei: Building an Inclusive Value Chain in India
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Asahi Kasei: Building an Inclusive Value Chain in India case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kasei Asahi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kasei Asahi 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 Asahi Kasei: Building an Inclusive Value Chain in India can be done for the following purposes –
1. Strategic planning using facts provided in Asahi Kasei: Building an Inclusive Value Chain in India case study
2. Improving business portfolio management of Kasei Asahi
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kasei Asahi
Strengths Asahi Kasei: Building an Inclusive Value Chain in India | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kasei Asahi in Asahi Kasei: Building an Inclusive Value Chain in India Harvard Business Review case study are -
Training and development
– Kasei Asahi has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Asahi Kasei: Building an Inclusive Value Chain in India 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.
Learning organization
- Kasei Asahi 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 Kasei Asahi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Asahi Kasei: Building an Inclusive Value Chain in India Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Kasei Asahi is one of the most innovative firm in sector. Manager in Asahi Kasei: Building an Inclusive Value Chain in India Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Kasei Asahi 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 Kasei Asahi
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kasei Asahi does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Kasei Asahi digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kasei Asahi 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.
Highly skilled collaborators
– Kasei Asahi 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 Asahi Kasei: Building an Inclusive Value Chain in India HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Kasei Asahi in the sector have low bargaining power. Asahi Kasei: Building an Inclusive Value Chain in India has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kasei Asahi to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Kasei Asahi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kasei Asahi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Kasei Asahi 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 Asahi Kasei: Building an Inclusive Value Chain in India - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Kasei Asahi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kasei Asahi 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.
Operational resilience
– The operational resilience strategy in the Asahi Kasei: Building an Inclusive Value Chain in India 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.
Weaknesses Asahi Kasei: Building an Inclusive Value Chain in India | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Asahi Kasei: Building an Inclusive Value Chain in India are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Asahi Kasei: Building an Inclusive Value Chain in India, is just above the industry average. Kasei Asahi 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.
Aligning sales with marketing
– It come across in the case study Asahi Kasei: Building an Inclusive Value Chain in India 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 Asahi Kasei: Building an Inclusive Value Chain in India can leverage the sales team experience to cultivate customer relationships as Kasei Asahi is planning to shift buying processes online.
Need for greater diversity
– Kasei Asahi 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.
Skills based hiring
– The stress on hiring functional specialists at Kasei Asahi 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.
Low market penetration in new markets
– Outside its home market of Kasei Asahi, firm in the HBR case study Asahi Kasei: Building an Inclusive Value Chain in India needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study Asahi Kasei: Building an Inclusive Value Chain in India, it seems that company is thinking about the frontier risks that can impact Global Business 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Asahi Kasei: Building an Inclusive Value Chain in India 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 Kasei Asahi has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Savita Shankar, Masahiro Okada suggests that, Kasei Asahi 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 Kasei Asahi is dominated by functional specialists. It is not different from other players in the Global Business segment. Kasei Asahi needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kasei Asahi to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Asahi Kasei: Building an Inclusive Value Chain in India HBR case study mentions - Kasei Asahi 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kasei Asahi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Asahi Kasei: Building an Inclusive Value Chain in India can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Asahi Kasei: Building an Inclusive Value Chain in India | 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 Asahi Kasei: Building an Inclusive Value Chain in India are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kasei Asahi 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. Kasei Asahi 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.
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 Kasei Asahi in the consumer business. Now Kasei Asahi 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. Kasei Asahi can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kasei Asahi 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, Asahi Kasei: Building an Inclusive Value Chain in India, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Kasei Asahi can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kasei Asahi is facing challenges because of the dominance of functional experts in the organization. Asahi Kasei: Building an Inclusive Value Chain in India 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 Kasei Asahi 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 Global Business segment.
Manufacturing automation
– Kasei Asahi can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Buying journey improvements
– Kasei Asahi can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Asahi Kasei: Building an Inclusive Value Chain in India 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, Kasei Asahi can use these opportunities to build new business models that can help the communities that Kasei Asahi operates in. Secondly it can use opportunities from government spending in Global Business sector.
Creating value in data economy
– The success of analytics program of Kasei Asahi has opened avenues for new revenue streams for the organization in the industry. This can help Kasei Asahi to build a more holistic ecosystem as suggested in the Asahi Kasei: Building an Inclusive Value Chain in India case study. Kasei Asahi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kasei Asahi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Kasei Asahi 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.
Threats Asahi Kasei: Building an Inclusive Value Chain in India External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Asahi Kasei: Building an Inclusive Value Chain in India are -
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. Kasei Asahi 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Kasei Asahi 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 Kasei Asahi in the Global Business industry. The Global Business 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.
Regulatory challenges
– Kasei Asahi 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 Global Business industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kasei Asahi 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 Asahi Kasei: Building an Inclusive Value Chain in India .
Stagnating economy with rate increase
– Kasei Asahi 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.
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.
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 Kasei Asahi business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Kasei Asahi has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Kasei Asahi needs to keep up with the evolution of technology in the Global Business 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.
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.
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 Kasei Asahi.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Asahi Kasei: Building an Inclusive Value Chain in India, Kasei Asahi may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
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. Kasei Asahi needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Asahi Kasei: Building an Inclusive Value Chain in India 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 Asahi Kasei: Building an Inclusive Value Chain in India 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 Asahi Kasei: Building an Inclusive Value Chain in India 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 Asahi Kasei: Building an Inclusive Value Chain in India 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 Asahi Kasei: Building an Inclusive Value Chain in India 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 Kasei Asahi needs to make to build a sustainable competitive advantage.
