Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures

In 1995, Sumio Abekawa, Daiwa Bank's president, received a letter on July 18 from Toshihide Iguchi, vice-president of the bank's New York branch. In that letter, Iguchi confessed that over the course of 11 years, he lost nearly $1.1 billion (approximately 123 billion yen) through the unauthorized trading of United States Treasury Bonds and had sold securities the bank had in custody to cover losses. Two months later, Daiwa's senior management reported the loss to the Federal Reserve Board of New York (FRB) and the New York State Banking Department. The bank directors faced several questions: Had the bank taken the appropriate steps to comply with U.S. reporting requirements? What was the potential liability of the directors? Would the Japanese bank directors be held liable for violating the law of a foreign country? How could the Japanese Ministry of Finance help?

Authors :: Mitsuru Misawa

Topics :: Global Business

Tags :: Business law, Corporate governance, Crisis management, Cross-cultural management, Human resource management, Organizational culture, Regulation, Risk management, Social responsibility, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures" written by Mitsuru Misawa includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Daiwa Iguchi facing as an external strategic factors. Some of the topics covered in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures case study are - Strategic Management Strategies, Business law, Corporate governance, Crisis management, Cross-cultural management, Human resource management, Organizational culture, Regulation, Risk management, Social responsibility and Global Business.

Some of the macro environment factors that can be used to understand the Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures casestudy better are - – challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, increasing commodity prices, increasing household debt because of falling income levels, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, etc

---

---

---

---

Introduction to SWOT Analysis of Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Daiwa Iguchi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Daiwa Iguchi 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures can be done for the following purposes –
1. Strategic planning using facts provided in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures case study
2. Improving business portfolio management of Daiwa Iguchi
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 Daiwa Iguchi

---

Strengths Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Daiwa Iguchi in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures Harvard Business Review case study are -

Digital Transformation in Global Business segment

- digital transformation varies from industry to industry. For Daiwa Iguchi digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Daiwa Iguchi 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.

Strong track record of project management

– Daiwa Iguchi is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Highly skilled collaborators

– Daiwa Iguchi 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Analytics focus

– Daiwa Iguchi 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 Mitsuru Misawa 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.

High brand equity

– Daiwa Iguchi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Daiwa Iguchi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Successful track record of launching new products

– Daiwa Iguchi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Daiwa Iguchi 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.

Learning organization

- Daiwa Iguchi 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 Daiwa Iguchi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Sustainable margins compare to other players in Global Business industry

– Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures firm has clearly differentiated products in the market place. This has enabled Daiwa Iguchi to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Daiwa Iguchi to invest into research and development (R&D) and innovation.

High switching costs

– The high switching costs that Daiwa Iguchi 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.

Cross disciplinary teams

– Horizontal connected teams at the Daiwa Iguchi are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.

Ability to lead change in Global Business field

– Daiwa Iguchi 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 Daiwa Iguchi in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Training and development

– Daiwa Iguchi has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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.

---

---

Weaknesses Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures are -

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures, it seems that the employees of Daiwa Iguchi 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.

Need for greater diversity

– Daiwa Iguchi 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.

Products dominated business model

– Even though Daiwa Iguchi 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 - Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures should strive to include more intangible value offerings along with its core products and services.

High operating costs

– Compare to the competitors, firm in the HBR case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Daiwa Iguchi 's lucrative customers.

Interest costs

– Compare to the competition, Daiwa Iguchi 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.

Workers concerns about automation

– As automation is fast increasing in the segment, Daiwa Iguchi 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.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures, in the dynamic environment Daiwa Iguchi has struggled to respond to the nimble upstart competition. Daiwa Iguchi has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

High bargaining power of channel partners

– Because of the regulatory requirements, Mitsuru Misawa suggests that, Daiwa Iguchi 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.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures, is just above the industry average. Daiwa Iguchi 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, Daiwa Iguchi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

High cash cycle compare to competitors

Daiwa Iguchi 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.

---

Opportunities Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures | 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures are -

Building a culture of innovation

– managers at Daiwa Iguchi 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.

Buying journey improvements

– Daiwa Iguchi can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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.

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. Daiwa Iguchi 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. Daiwa Iguchi 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.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Daiwa Iguchi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Daiwa Iguchi is facing challenges because of the dominance of functional experts in the organization. Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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.

Manufacturing automation

– Daiwa Iguchi 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Daiwa Iguchi 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 Daiwa Iguchi to hire the very best people irrespective of their geographical location.

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 Daiwa Iguchi 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.

Creating value in data economy

– The success of analytics program of Daiwa Iguchi has opened avenues for new revenue streams for the organization in the industry. This can help Daiwa Iguchi to build a more holistic ecosystem as suggested in the Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures case study. Daiwa Iguchi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Daiwa Iguchi can use these opportunities to build new business models that can help the communities that Daiwa Iguchi operates in. Secondly it can use opportunities from government spending in Global Business sector.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Daiwa Iguchi 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.

Developing new processes and practices

– Daiwa Iguchi 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Daiwa Iguchi 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, Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

---

Threats Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures are -

High dependence on third party suppliers

– Daiwa Iguchi 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.

Regulatory challenges

– Daiwa Iguchi 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.

Technology acceleration in Forth Industrial Revolution

– Daiwa Iguchi has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Daiwa Iguchi 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.

Environmental challenges

– Daiwa Iguchi 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. Daiwa Iguchi can take advantage of this fund but it will also bring new competitors in the Global Business industry.

Consumer confidence and its impact on Daiwa Iguchi 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.

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.

Stagnating economy with rate increase

– Daiwa Iguchi 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures, Daiwa Iguchi 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 .

Easy access to finance

– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Daiwa Iguchi can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Daiwa Iguchi 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures .

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Daiwa Iguchi 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 Daiwa Iguchi is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

---

Weighted SWOT Analysis of Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Daiwa Iguchi needs to make to build a sustainable competitive advantage.

--- ---