ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
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Case Study Description of ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?
The economic policies advocated by Prime Minister Shinzo Abe of Japan, dubbed Abenomics, have weakened the yen and given new life to Japan's stock market. There are three components of Abenomics: monetary easing, fiscal spending, and growth strategies. The economy-boosting effects of Abenomics and the Bank of Japan's (BOJ's) bold monetary easing policy are stirring up considerable global interest in Japan. Of the three components of Abenomics, monetary easing and fiscal spending are unlikely to inflict much pain on the public, apart from the fact that younger generations will be forced to pay back the debt the government is rapidly incurring. But the third component, growth strategies, can only be effective when addressing regulatory issues that have long been left untouched. What Japan needs most is regulatory and structural reform. These painful, drastic reforms will shuffle the deck for protected businesses. While structural reforms almost always inflict pain on vested interests protected by regulatory walls, creative initiatives by newcomers benefit consumers and help to revitalize the economy.
Swot Analysis of "ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?" written by Mitsuru Misawa includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Abenomics Easing facing as an external strategic factors. Some of the topics covered in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? case study are - Strategic Management Strategies, Growth strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? casestudy better are - – geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google,
banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Abenomics Easing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Abenomics Easing 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? can be done for the following purposes –
1. Strategic planning using facts provided in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? case study
2. Improving business portfolio management of Abenomics Easing
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 Abenomics Easing
Strengths ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Abenomics Easing in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Abenomics Easing in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Leadership & Managing People field
– Abenomics Easing 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 Abenomics Easing in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Leadership & Managing People industry
– ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? firm has clearly differentiated products in the market place. This has enabled Abenomics Easing to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Abenomics Easing to invest into research and development (R&D) and innovation.
Learning organization
- Abenomics Easing 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 Abenomics Easing is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Abenomics Easing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Abenomics Easing 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.
Cross disciplinary teams
– Horizontal connected teams at the Abenomics Easing 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.
Effective Research and Development (R&D)
– Abenomics Easing 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Abenomics Easing in the sector have low bargaining power. ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Abenomics Easing to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Abenomics Easing 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Abenomics Easing has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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.
High switching costs
– The high switching costs that Abenomics Easing 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.
Ability to recruit top talent
– Abenomics Easing is one of the leading recruiters in the industry. Managers in the ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? are -
Slow to strategic competitive environment developments
– As ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? HBR case study mentions - Abenomics Easing takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Need for greater diversity
– Abenomics Easing 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?, it seems that the employees of Abenomics Easing 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 operating costs
– Compare to the competitors, firm in the HBR case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 Abenomics Easing 's lucrative customers.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Abenomics Easing supply chain. Even after few cautionary changes mentioned in the HBR case study - ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Abenomics Easing vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 Abenomics Easing has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High cash cycle compare to competitors
Abenomics Easing 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.
Capital Spending Reduction
– Even during the low interest decade, Abenomics Easing 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?, in the dynamic environment Abenomics Easing has struggled to respond to the nimble upstart competition. Abenomics Easing has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? can leverage the sales team experience to cultivate customer relationships as Abenomics Easing is planning to shift buying processes online.
Opportunities ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? | 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Abenomics Easing can use these opportunities to build new business models that can help the communities that Abenomics Easing operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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. Abenomics Easing can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Abenomics Easing can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Buying journey improvements
– Abenomics Easing can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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.
Building a culture of innovation
– managers at Abenomics Easing 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Abenomics Easing 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Abenomics Easing is facing challenges because of the dominance of functional experts in the organization. ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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.
Better consumer reach
– The expansion of the 5G network will help Abenomics Easing to increase its market reach. Abenomics Easing 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.
Loyalty marketing
– Abenomics Easing 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Abenomics Easing 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 Abenomics Easing to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Abenomics Easing has opened avenues for new revenue streams for the organization in the industry. This can help Abenomics Easing to build a more holistic ecosystem as suggested in the ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? case study. Abenomics Easing can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Abenomics Easing can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Abenomics Easing 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, ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?, 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? are -
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.
High dependence on third party suppliers
– Abenomics Easing 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
– Abenomics Easing 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.
Environmental challenges
– Abenomics Easing 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. Abenomics Easing can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Abenomics Easing.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION?, Abenomics Easing 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Abenomics Easing in the Leadership & Managing People industry. The Leadership & Managing People 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Abenomics Easing with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Abenomics Easing 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.
Technology acceleration in Forth Industrial Revolution
– Abenomics Easing has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Abenomics Easing needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Shortening product life cycle
– it is one of the major threat that Abenomics Easing is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Abenomics Easing in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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 Abenomics Easing needs to make to build a sustainable competitive advantage.
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