Describes the introduction of two profit planning and control systems at Kirin as part of its shift from a production-oriented to a consumer-oriented strategy. Specifically, documents Kirin's use of profit centers to increase efficiency and its use of pseudo profit centers to increase revenues and decrease costs.
Swot Analysis of "Kirin Brewery Co. Ltd." written by Robin Cooper includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kirin Kirin's facing as an external strategic factors. Some of the topics covered in Kirin Brewery Co. Ltd. case study are - Strategic Management Strategies, Costs, Organizational structure and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Kirin Brewery Co. Ltd. casestudy better are - – there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs,
banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Kirin Brewery Co. Ltd.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kirin Brewery Co. Ltd. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kirin Kirin's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kirin Kirin's 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 Kirin Brewery Co. Ltd. can be done for the following purposes –
1. Strategic planning using facts provided in Kirin Brewery Co. Ltd. case study
2. Improving business portfolio management of Kirin Kirin's
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kirin Kirin's
Strengths Kirin Brewery Co. Ltd. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kirin Kirin's in Kirin Brewery Co. Ltd. Harvard Business Review case study are -
Organizational Resilience of Kirin Kirin's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kirin Kirin's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Kirin Kirin's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kirin Kirin's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Kirin Kirin's 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 recruit top talent
– Kirin Kirin's is one of the leading recruiters in the industry. Managers in the Kirin Brewery Co. Ltd. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Kirin Kirin's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kirin Kirin's 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 Kirin Kirin's 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.
Superior customer experience
– The customer experience strategy of Kirin Kirin's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the Kirin Brewery Co. Ltd. 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.
Diverse revenue streams
– Kirin Kirin's is present in almost all the verticals within the industry. This has provided firm in Kirin Brewery Co. Ltd. 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.
Learning organization
- Kirin Kirin's 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 Kirin Kirin's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Kirin Brewery Co. Ltd. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Kirin Kirin's 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 Robin Cooper 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.
Effective Research and Development (R&D)
– Kirin Kirin's 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 Kirin Brewery Co. Ltd. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Kirin Brewery Co. Ltd. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kirin Brewery Co. Ltd. are -
High bargaining power of channel partners
– Because of the regulatory requirements, Robin Cooper suggests that, Kirin Kirin's 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Kirin Brewery Co. Ltd., in the dynamic environment Kirin Kirin's has struggled to respond to the nimble upstart competition. Kirin Kirin's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Kirin Brewery Co. Ltd. HBR case study mentions - Kirin Kirin's 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Kirin Brewery Co. Ltd., is just above the industry average. Kirin Kirin's 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Kirin Brewery Co. Ltd., it seems that the employees of Kirin Kirin's 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.
Interest costs
– Compare to the competition, Kirin Kirin's 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Kirin Brewery Co. Ltd. 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 Kirin Kirin's 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Kirin Kirin's, firm in the HBR case study Kirin Brewery Co. Ltd. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Kirin Kirin's products
– To increase the profitability and margins on the products, Kirin Kirin's needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Kirin Kirin's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kirin Kirin's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Kirin Brewery Co. Ltd. can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Kirin Brewery Co. Ltd. | 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 Kirin Brewery Co. Ltd. are -
Loyalty marketing
– Kirin Kirin's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kirin Kirin's 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, Kirin Brewery Co. Ltd., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Kirin Kirin's has opened avenues for new revenue streams for the organization in the industry. This can help Kirin Kirin's to build a more holistic ecosystem as suggested in the Kirin Brewery Co. Ltd. case study. Kirin Kirin's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kirin Kirin's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
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. Kirin Kirin's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Kirin Kirin's 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 Finance & Accounting segment.
Developing new processes and practices
– Kirin Kirin's can develop new processes and procedures in Finance & Accounting 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.
Leveraging digital technologies
– Kirin Kirin's 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kirin Kirin's 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. Kirin Kirin's 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.
Using analytics as competitive advantage
– Kirin Kirin's 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 Kirin Brewery Co. Ltd. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kirin Kirin's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Kirin Kirin's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Kirin Brewery Co. Ltd. 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kirin Kirin's is facing challenges because of the dominance of functional experts in the organization. Kirin Brewery Co. Ltd. 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kirin Kirin's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Kirin Brewery Co. Ltd. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kirin Brewery Co. Ltd. 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. Kirin Kirin's needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kirin Kirin's in the Finance & Accounting industry. The Finance & Accounting 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.
Stagnating economy with rate increase
– Kirin Kirin's 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 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.
Technology acceleration in Forth Industrial Revolution
– Kirin Kirin's has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Kirin Kirin's needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Kirin Brewery Co. Ltd., Kirin Kirin's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
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. Kirin Kirin's 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.
Environmental challenges
– Kirin Kirin's 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. Kirin Kirin's can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Regulatory challenges
– Kirin Kirin's 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 Finance & Accounting industry regulations.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Kirin Kirin's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kirin Kirin's 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 Kirin Kirin's in the Finance & Accounting sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Kirin Brewery Co. Ltd. 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 Kirin Brewery Co. Ltd. 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 Kirin Brewery Co. Ltd. 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 Kirin Brewery Co. Ltd. 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 Kirin Brewery Co. Ltd. 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 Kirin Kirin's needs to make to build a sustainable competitive advantage.