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 - – wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, increasing transportation and logistics costs, technology disruption, there is backlash against globalization, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, etc

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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.

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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

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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 -

Low bargaining power of suppliers

– Suppliers of Daiwa Iguchi in the sector have low bargaining power. Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Daiwa Iguchi to manage not only supply disruptions but also source products at highly competitive prices.

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.

Ability to recruit top talent

– Daiwa Iguchi is one of the leading recruiters in the industry. Managers in the Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

Superior customer experience

– The customer experience strategy of Daiwa Iguchi in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

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.

Innovation driven organization

– Daiwa Iguchi is one of the most innovative firm in sector. Manager in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

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.

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.

Diverse revenue streams

– Daiwa Iguchi is present in almost all the verticals within the industry. This has provided firm in Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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.

Effective Research and Development (R&D)

– Daiwa Iguchi 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Operational resilience

– The operational resilience strategy in the Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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.

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.

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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 -

Aligning sales with marketing

– It come across in the case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures can leverage the sales team experience to cultivate customer relationships as Daiwa Iguchi is planning to shift buying processes online.

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.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures 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 Daiwa Iguchi has relatively successful track record of launching new products.

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.

No frontier risks strategy

– After analyzing the HBR case study Rogue Trader at Daiwa Bank (A): Management Responsibility Under Different Jurisprudential Systems, Practices and Cultures, 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.

Lack of clear differentiation of Daiwa Iguchi products

– To increase the profitability and margins on the products, Daiwa Iguchi 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 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.

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.

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.

Skills based hiring

– The stress on hiring functional specialists at Daiwa Iguchi 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.

Capital Spending Reduction

– Even during the low interest decade, Daiwa Iguchi 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.

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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 -

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.

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.

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. Daiwa Iguchi can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Learning at scale

– Online learning technologies has now opened space for Daiwa Iguchi to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.

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.

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.

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.

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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Daiwa Iguchi 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.

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.

Loyalty marketing

– Daiwa Iguchi 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.

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.

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.

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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 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. Daiwa Iguchi needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.

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.

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.

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.

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 Daiwa Iguchi business can come under increasing regulations regarding data privacy, data security, etc.

Increasing wage structure of Daiwa Iguchi

– 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 Daiwa Iguchi.

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.

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 .

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.

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.

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. Daiwa Iguchi 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.

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.

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 Daiwa Iguchi in the Global Business sector and impact the bottomline of the organization.

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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.

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