The Dojima Rice Market and the Origins of Futures Trading SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Dojima Rice Market and the Origins of Futures Trading
In 1730, Japanese merchants petitioned shogun Tokugawa Yoshimune to officially authorize trade in rice futures at the Dojima Exchange, the world's first organized (but unsanctioned) futures market. For many years, the Japanese government had prohibited the trade of futures bills because it was widely regarded as a form of gambling that caused rice prices to rise. However, when the price of rice fell to record lows in the late 1720s, the samurai (whose income was tied to the value of rice) saw their economic position fall relative to the merchant class, whose growing economic power worried the nation's elites. The shogun responded by easing restrictions on futures trading, but without officially sanctioning a futures market at Dojima. The question now was whether he should heed the merchants' petition and take the next step.
Swot Analysis of "The Dojima Rice Market and the Origins of Futures Trading" written by David A. Moss, Eugene Kintgen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Futures Rice facing as an external strategic factors. Some of the topics covered in The Dojima Rice Market and the Origins of Futures Trading case study are - Strategic Management Strategies, Financial management, Financial markets, Government, Negotiations and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the The Dojima Rice Market and the Origins of Futures Trading casestudy better are - – increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, technology disruption, supply chains are disrupted by pandemic , increasing energy prices, wage bills are increasing,
competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of The Dojima Rice Market and the Origins of Futures Trading
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Dojima Rice Market and the Origins of Futures Trading case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Futures Rice, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Futures Rice operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of The Dojima Rice Market and the Origins of Futures Trading can be done for the following purposes –
1. Strategic planning using facts provided in The Dojima Rice Market and the Origins of Futures Trading case study
2. Improving business portfolio management of Futures Rice
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Futures Rice
Strengths The Dojima Rice Market and the Origins of Futures Trading | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Futures Rice in The Dojima Rice Market and the Origins of Futures Trading Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Futures Rice in the sector have low bargaining power. The Dojima Rice Market and the Origins of Futures Trading has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Futures Rice to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Futures Rice has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Dojima Rice Market and the Origins of Futures Trading 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.
Strong track record of project management
– Futures Rice is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Leadership & Managing People field
– Futures Rice 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 Futures Rice in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Futures Rice is one of the most innovative firm in sector. Manager in The Dojima Rice Market and the Origins of Futures Trading Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Futures Rice is one of the leading recruiters in the industry. Managers in the The Dojima Rice Market and the Origins of Futures Trading are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Futures Rice has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Futures Rice to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Futures Rice is present in almost all the verticals within the industry. This has provided firm in The Dojima Rice Market and the Origins of Futures Trading 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 Leadership & Managing People industry
– The Dojima Rice Market and the Origins of Futures Trading firm has clearly differentiated products in the market place. This has enabled Futures Rice to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Futures Rice to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Futures Rice 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.
Superior customer experience
– The customer experience strategy of Futures Rice in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Futures Rice 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.
Weaknesses The Dojima Rice Market and the Origins of Futures Trading | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Dojima Rice Market and the Origins of Futures Trading are -
Products dominated business model
– Even though Futures Rice has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Dojima Rice Market and the Origins of Futures Trading should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Futures Rice 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Dojima Rice Market and the Origins of Futures Trading, is just above the industry average. Futures Rice 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.
High cash cycle compare to competitors
Futures Rice 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.
Interest costs
– Compare to the competition, Futures Rice 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Dojima Rice Market and the Origins of Futures Trading, in the dynamic environment Futures Rice has struggled to respond to the nimble upstart competition. Futures Rice has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Futures Rice is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Dojima Rice Market and the Origins of Futures Trading can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Futures Rice products
– To increase the profitability and margins on the products, Futures Rice needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study The Dojima Rice Market and the Origins of Futures Trading 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 The Dojima Rice Market and the Origins of Futures Trading can leverage the sales team experience to cultivate customer relationships as Futures Rice is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Futures Rice has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Futures Rice even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Need for greater diversity
– Futures Rice 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.
Opportunities The Dojima Rice Market and the Origins of Futures Trading | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study The Dojima Rice Market and the Origins of Futures Trading are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Futures Rice can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Futures Rice in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
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 Futures Rice 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Futures Rice can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, The Dojima Rice Market and the Origins of Futures Trading, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Futures Rice in the consumer business. Now Futures Rice can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Futures Rice to increase its market reach. Futures Rice 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.
Using analytics as competitive advantage
– Futures Rice has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study The Dojima Rice Market and the Origins of Futures Trading - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Futures Rice to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Futures Rice can use these opportunities to build new business models that can help the communities that Futures Rice operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Leveraging digital technologies
– Futures Rice 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.
Learning at scale
– Online learning technologies has now opened space for Futures Rice 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Futures Rice is facing challenges because of the dominance of functional experts in the organization. The Dojima Rice Market and the Origins of Futures Trading 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.
Loyalty marketing
– Futures Rice 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.
Building a culture of innovation
– managers at Futures Rice 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 Leadership & Managing People segment.
Threats The Dojima Rice Market and the Origins of Futures Trading External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Dojima Rice Market and the Origins of Futures Trading are -
Increasing wage structure of Futures Rice
– 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 Futures Rice.
Shortening product life cycle
– it is one of the major threat that Futures Rice is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Futures Rice needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Futures Rice with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Futures Rice in the Leadership & Managing People sector and impact the bottomline of the organization.
Regulatory challenges
– Futures Rice 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 Leadership & Managing People industry regulations.
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. Futures Rice 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.
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 Futures Rice business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Futures Rice 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. Futures Rice can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The Dojima Rice Market and the Origins of Futures Trading, Futures Rice may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Consumer confidence and its impact on Futures Rice 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.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Futures Rice can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Futures Rice 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.
Weighted SWOT Analysis of The Dojima Rice Market and the Origins of Futures Trading Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study The Dojima Rice Market and the Origins of Futures Trading needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study The Dojima Rice Market and the Origins of Futures Trading is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study The Dojima Rice Market and the Origins of Futures Trading is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of The Dojima Rice Market and the Origins of Futures Trading 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 Futures Rice needs to make to build a sustainable competitive advantage.