ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
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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 - – talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, wage bills are increasing, increasing household debt because of falling income levels, increasing energy prices,
cloud computing is disrupting traditional business models, technology disruption, 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 -
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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Abenomics Easing digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Abenomics Easing 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.
Operational resilience
– The operational resilience strategy in the ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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.
Innovation driven organization
– Abenomics Easing is one of the most innovative firm in sector. Manager in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
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.
Diverse revenue streams
– Abenomics Easing is present in almost all the verticals within the industry. This has provided firm in ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? 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.
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.
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.
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.
Strong track record of project management
– Abenomics Easing is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
High brand equity
– Abenomics Easing has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Abenomics Easing to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
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 -
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.
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.
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.
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.
Workers concerns about automation
– As automation is fast increasing in the segment, Abenomics Easing needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
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.
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.
Interest costs
– Compare to the competition, Abenomics Easing 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.
Increasing silos among functional specialists
– The organizational structure of Abenomics Easing is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Abenomics Easing needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Abenomics Easing to focus more on services rather than just following the product oriented approach.
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.
Skills based hiring
– The stress on hiring functional specialists at Abenomics Easing 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.
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 -
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 Abenomics Easing in the consumer business. Now Abenomics Easing can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Abenomics Easing can develop new processes and procedures in Leadership & Managing People 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
– Abenomics Easing 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.
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.
Learning at scale
– Online learning technologies has now opened space for Abenomics Easing 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 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.
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 Abenomics Easing 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.
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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Abenomics Easing can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Abenomics Easing 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. Abenomics Easing 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Abenomics Easing 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.
Using analytics as competitive advantage
– Abenomics Easing 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 ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Abenomics Easing to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Abenomics Easing can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study ABENOMICS OF JAPAN: WHAT WAS IT? COULD THIS CONQUER JAPAN'S DECADE-LONG DEFLATION? .
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.
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 Abenomics Easing business can come under increasing regulations regarding data privacy, data security, etc.
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.
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. Abenomics Easing 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.
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.
Consumer confidence and its impact on Abenomics Easing 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.
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 .
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.
Increasing wage structure of Abenomics Easing
– 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 Abenomics Easing.
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. Abenomics Easing 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 Abenomics Easing in the Leadership & Managing People sector and impact the bottomline of the organization.
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. Abenomics Easing needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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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