Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market
Facing a decline in the company's core camera business as a result of the aggressive entry of smartphones, Canon identified the network security industry as a potential growth market, with expected revenues of US$23 billion by 2020. Canon opted to pursue this kind of growth potential outside its core competency by acquiring Milestone Systems in 2014 and Axis Communications in 2015. Canon paid a 50-per-cent premium to acquire Axis in a cash-only offer, while choosing to allow its two acquired companies to continue operating as independent entities. Should Canon have instead created a strategic alliance with these two companies? Would these acquisitions allow Canon to achieve synergies and secure its goal of $1 billion in sales from the network securities market by 2020? Wiboon Kittilaksanawong is affiliated with Saitama University. Andrew Jiro Poplawski is affiliated with Nagoya University of Commerce & Business.
Authors :: Wiboon Kittilaksanawong, Andrew Jiro Poplawski
Swot Analysis of "Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market" written by Wiboon Kittilaksanawong, Andrew Jiro Poplawski includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Canon Axis facing as an external strategic factors. Some of the topics covered in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market case study are - Strategic Management Strategies, Marketing, Mergers & acquisitions, Risk management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market casestudy better are - – geopolitical disruptions, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, there is backlash against globalization,
talent flight as more people leaving formal jobs, increasing commodity prices, etc
Introduction to SWOT Analysis of Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Canon Axis, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Canon Axis 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market can be done for the following purposes –
1. Strategic planning using facts provided in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market case study
2. Improving business portfolio management of Canon Axis
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 Canon Axis
Strengths Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Canon Axis in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market Harvard Business Review case study are -
Organizational Resilience of Canon Axis
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Canon Axis does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Canon Axis digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Canon Axis 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.
Learning organization
- Canon Axis 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 Canon Axis is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Canon Axis is present in almost all the verticals within the industry. This has provided firm in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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.
Successful track record of launching new products
– Canon Axis has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Canon Axis 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
– Canon Axis has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Canon Axis to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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.
Low bargaining power of suppliers
– Suppliers of Canon Axis in the sector have low bargaining power. Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Canon Axis to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Canon Axis is one of the most innovative firm in sector. Manager in Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Canon Axis 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Leadership & Managing People industry
– Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market firm has clearly differentiated products in the market place. This has enabled Canon Axis to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Canon Axis to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Canon Axis is one of the leading recruiters in the industry. Managers in the Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market are -
Lack of clear differentiation of Canon Axis products
– To increase the profitability and margins on the products, Canon Axis needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Canon Axis supply chain. Even after few cautionary changes mentioned in the HBR case study - Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Canon Axis vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Canon Axis 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market, it seems that the employees of Canon Axis 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market, in the dynamic environment Canon Axis has struggled to respond to the nimble upstart competition. Canon Axis has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Canon Axis, firm in the HBR case study Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Axis has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market HBR case study mentions - Canon Axis 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Canon Axis is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Canon Axis 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 - Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Canon Axis 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market | 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market are -
Loyalty marketing
– Canon Axis 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.
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 Canon Axis 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 Canon Axis to increase its market reach. Canon Axis 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Canon Axis can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Canon Axis 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Canon Axis 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 Canon Axis to hire the very best people irrespective of their geographical location.
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. Canon Axis can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Canon Axis 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Canon Axis 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, Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Canon Axis 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, Canon Axis can use these opportunities to build new business models that can help the communities that Canon Axis operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Using analytics as competitive advantage
– Canon Axis 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Canon Axis to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Canon Axis is facing challenges because of the dominance of functional experts in the organization. Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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.
Threats Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market are -
Environmental challenges
– Canon Axis 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. Canon Axis 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 Canon Axis business can come under increasing regulations regarding data privacy, data security, etc.
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. Canon Axis 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market, Canon Axis 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 .
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. Canon Axis needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Canon Axis 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market .
Technology acceleration in Forth Industrial Revolution
– Canon Axis has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Canon Axis 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.
Consumer confidence and its impact on Canon Axis 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.
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 Canon Axis.
High dependence on third party suppliers
– Canon Axis 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
– Canon Axis 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Canon Axis with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Weighted SWOT Analysis of Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Inc.: Ambitious Acquisitions in the Video Surveillance Market 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 Canon Axis needs to make to build a sustainable competitive advantage.