Case Study Description of NTT DoCoMo: Establishing Global 3G Standards
In October 2001, NTT DoCoMo, Japan's leading mobile telecommunications company, launched the world's first commercial third-generation (3G) mobile service. However, the new service faced technological obstacles. Many observers were skeptical about its future success. But 3G in Japan was only DoCoMo's first step in a grand plan to have its standards of 3G technology and service established worldwide. By late 2001, DoCoMo had formed alliances with major telecommunications players in Asia, Europe, and the United States to develop 3G networks. Despite technological setbacks and astronomical fees for obtaining a license to operate 3G in some European countries, DoCoMo and its partners continued to build the infrastructure for the new-generation service. Analysts saw these moves as a gamble.
Swot Analysis of "NTT DoCoMo: Establishing Global 3G Standards" written by Ali F. Farhoomand, Vincent Mak includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 3g Docomo facing as an external strategic factors. Some of the topics covered in NTT DoCoMo: Establishing Global 3G Standards case study are - Strategic Management Strategies, Globalization, Growth strategy, Joint ventures, Technology and Global Business.
Some of the macro environment factors that can be used to understand the NTT DoCoMo: Establishing Global 3G Standards casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs,
geopolitical disruptions, technology disruption, etc
Introduction to SWOT Analysis of NTT DoCoMo: Establishing Global 3G Standards
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in NTT DoCoMo: Establishing Global 3G Standards case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 3g Docomo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 3g Docomo 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 NTT DoCoMo: Establishing Global 3G Standards can be done for the following purposes –
1. Strategic planning using facts provided in NTT DoCoMo: Establishing Global 3G Standards case study
2. Improving business portfolio management of 3g Docomo
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 3g Docomo
Strengths NTT DoCoMo: Establishing Global 3G Standards | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 3g Docomo in NTT DoCoMo: Establishing Global 3G Standards Harvard Business Review case study are -
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For 3g Docomo digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. 3g Docomo 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.
Effective Research and Development (R&D)
– 3g Docomo 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 NTT DoCoMo: Establishing Global 3G Standards - 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 switching costs
– The high switching costs that 3g Docomo 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.
Training and development
– 3g Docomo has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in NTT DoCoMo: Establishing Global 3G Standards 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.
Ability to recruit top talent
– 3g Docomo is one of the leading recruiters in the industry. Managers in the NTT DoCoMo: Establishing Global 3G Standards are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– 3g Docomo 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 Ali F. Farhoomand, Vincent Mak 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.
Ability to lead change in Global Business field
– 3g Docomo 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 3g Docomo 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
– 3g Docomo is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– 3g Docomo is present in almost all the verticals within the industry. This has provided firm in NTT DoCoMo: Establishing Global 3G Standards 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.
Sustainable margins compare to other players in Global Business industry
– NTT DoCoMo: Establishing Global 3G Standards firm has clearly differentiated products in the market place. This has enabled 3g Docomo to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped 3g Docomo to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the NTT DoCoMo: Establishing Global 3G Standards 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.
Low bargaining power of suppliers
– Suppliers of 3g Docomo in the sector have low bargaining power. NTT DoCoMo: Establishing Global 3G Standards has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps 3g Docomo to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses NTT DoCoMo: Establishing Global 3G Standards | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of NTT DoCoMo: Establishing Global 3G Standards are -
Products dominated business model
– Even though 3g Docomo 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 - NTT DoCoMo: Establishing Global 3G Standards should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of 3g Docomo products
– To increase the profitability and margins on the products, 3g Docomo needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of 3g Docomo is dominated by functional specialists. It is not different from other players in the Global Business segment. 3g Docomo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help 3g Docomo to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study NTT DoCoMo: Establishing Global 3G Standards, in the dynamic environment 3g Docomo has struggled to respond to the nimble upstart competition. 3g Docomo has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study NTT DoCoMo: Establishing Global 3G Standards, is just above the industry average. 3g Docomo 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, 3g Docomo is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study NTT DoCoMo: Establishing Global 3G Standards can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, 3g Docomo has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Skills based hiring
– The stress on hiring functional specialists at 3g Docomo 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the NTT DoCoMo: Establishing Global 3G Standards 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 3g Docomo has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of 3g Docomo, firm in the HBR case study NTT DoCoMo: Establishing Global 3G Standards needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study NTT DoCoMo: Establishing Global 3G Standards, 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.
Opportunities NTT DoCoMo: Establishing Global 3G Standards | 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 NTT DoCoMo: Establishing Global 3G Standards are -
Better consumer reach
– The expansion of the 5G network will help 3g Docomo to increase its market reach. 3g Docomo 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.
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 3g Docomo in the consumer business. Now 3g Docomo 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. 3g Docomo can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– 3g Docomo 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.
Using analytics as competitive advantage
– 3g Docomo 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 NTT DoCoMo: Establishing Global 3G Standards - to build a competitive advantage using analytics. The analytics driven competitive advantage can help 3g Docomo to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, 3g Docomo 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, 3g Docomo can use these opportunities to build new business models that can help the communities that 3g Docomo operates in. Secondly it can use opportunities from government spending in Global Business sector.
Manufacturing automation
– 3g Docomo 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. 3g Docomo can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, 3g Docomo 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, NTT DoCoMo: Establishing Global 3G Standards, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for 3g Docomo 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 3g Docomo to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for 3g Docomo in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of 3g Docomo has opened avenues for new revenue streams for the organization in the industry. This can help 3g Docomo to build a more holistic ecosystem as suggested in the NTT DoCoMo: Establishing Global 3G Standards case study. 3g Docomo can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats NTT DoCoMo: Establishing Global 3G Standards External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study NTT DoCoMo: Establishing Global 3G Standards are -
Technology acceleration in Forth Industrial Revolution
– 3g Docomo has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, 3g Docomo 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study NTT DoCoMo: Establishing Global 3G Standards, 3g Docomo 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 .
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 3g Docomo.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 3g Docomo 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 NTT DoCoMo: Establishing Global 3G Standards .
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 3g Docomo business can come under increasing regulations regarding data privacy, data security, etc.
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 3g Docomo in the Global Business sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that 3g Docomo is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for 3g Docomo 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.
Consumer confidence and its impact on 3g Docomo 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.
Regulatory challenges
– 3g Docomo 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.
Environmental challenges
– 3g Docomo 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. 3g Docomo can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents 3g Docomo with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of NTT DoCoMo: Establishing Global 3G Standards 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 NTT DoCoMo: Establishing Global 3G Standards 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 NTT DoCoMo: Establishing Global 3G Standards 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 NTT DoCoMo: Establishing Global 3G Standards 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 NTT DoCoMo: Establishing Global 3G Standards 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 3g Docomo needs to make to build a sustainable competitive advantage.