Taisho Pharmaceutical Hold Ltd (4581) SWOT Analysis / TOWS Matrix / MBA Resources
Major Drugs
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Taisho Pharmaceutical Hold Ltd (Japan)
Based on various researches at Oak Spring University , Taisho Pharmaceutical Hold Ltd is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, talent flight as more people leaving formal jobs, there is backlash against globalization, cloud computing is disrupting traditional business models, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing,
challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Taisho Pharmaceutical Hold Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Taisho Pharmaceutical Hold Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Taisho Pharmaceutical Hold Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold Ltd can be done for the following purposes –
1. Strategic planning of Taisho Pharmaceutical Hold Ltd
2. Improving business portfolio management of Taisho Pharmaceutical Hold Ltd
3. Assessing feasibility of the new initiative in Japan
4. Making a Major Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Taisho Pharmaceutical Hold Ltd
Strengths of Taisho Pharmaceutical Hold Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Taisho Pharmaceutical Hold Ltd are -
Ability to lead change in Major Drugs
– Taisho Pharmaceutical Hold Ltd is one of the leading players in the Major Drugs industry in Japan. Over the years it has not only transformed the business landscape in the Major Drugs industry in Japan but also across the existing markets. The ability to lead change has enabled Taisho Pharmaceutical Hold Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Taisho Pharmaceutical Hold Ltd is present in almost all the verticals within the Major Drugs industry. This has provided Taisho Pharmaceutical Hold Ltd 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
– Taisho Pharmaceutical Hold Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Taisho Pharmaceutical Hold Ltd 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.
Effective Research and Development (R&D)
– Taisho Pharmaceutical Hold Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Taisho Pharmaceutical Hold Ltd staying ahead in the Major Drugs industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Taisho Pharmaceutical Hold Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Taisho Pharmaceutical Hold Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Taisho Pharmaceutical Hold Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Taisho Pharmaceutical Hold Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of Taisho Pharmaceutical Hold Ltd comprises – understanding the underlying the factors in the Major Drugs 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.
Digital Transformation in Major Drugs industry
- digital transformation varies from industry to industry. For Taisho Pharmaceutical Hold Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Taisho Pharmaceutical Hold Ltd 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.
Analytics focus
– Taisho Pharmaceutical Hold Ltd 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 Major Drugs industry. The technology infrastructure of Japan is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Training and development
– Taisho Pharmaceutical Hold Ltd has one of the best training and development program in Healthcare industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Cross disciplinary teams
– Horizontal connected teams at the Taisho Pharmaceutical Hold Ltd 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.
Innovation driven organization
– Taisho Pharmaceutical Hold Ltd is one of the most innovative firm in Major Drugs sector.
Weaknesses of Taisho Pharmaceutical Hold Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold Ltd supply chain. Even after few cautionary changes, Taisho Pharmaceutical Hold Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Taisho Pharmaceutical Hold Ltd vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of Taisho Pharmaceutical Hold Ltd is just above the Major Drugs industry average. It 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.
Lack of clear differentiation of Taisho Pharmaceutical Hold Ltd products
– To increase the profitability and margins on the products, Taisho Pharmaceutical Hold Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– From the 10K / annual statement of Taisho Pharmaceutical Hold Ltd, it seems that company is thinking out the frontier risks that can impact Major Drugs industry. 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.
Aligning sales with marketing
– From the outside it seems that Taisho Pharmaceutical Hold Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Major Drugs industry have deep experience in developing customer relationships. Marketing department at Taisho Pharmaceutical Hold Ltd can leverage the sales team experience to cultivate customer relationships as Taisho Pharmaceutical Hold Ltd is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Taisho Pharmaceutical Hold Ltd has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Major Drugs industry over the last five years. Taisho Pharmaceutical Hold Ltd even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative at Taisho Pharmaceutical Hold Ltd, in the dynamic environment of Major Drugs industry it has struggled to respond to the nimble upstart competition. Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold Ltd is one of the leading players in the Major Drugs industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Major Drugs industry in last five years.
Products dominated business model
– Even though Taisho Pharmaceutical Hold Ltd has some of the most successful models in the Major Drugs industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Taisho Pharmaceutical Hold Ltd should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners in Major Drugs industry
– because of the regulatory requirements in Japan, Taisho Pharmaceutical Hold Ltd 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 Major Drugs industry.
Interest costs
– Compare to the competition, Taisho Pharmaceutical Hold Ltd 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.
Taisho Pharmaceutical Hold Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Taisho Pharmaceutical Hold Ltd are -
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 Taisho Pharmaceutical Hold Ltd 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.
Buying journey improvements
– Taisho Pharmaceutical Hold Ltd can improve the customer journey of consumers in the Major Drugs industry by using analytics and artificial intelligence. It 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.
Loyalty marketing
– Taisho Pharmaceutical Hold Ltd 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.
Use of Bitcoin and other crypto currencies for transactions in Major Drugs industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Taisho Pharmaceutical Hold Ltd in the Major Drugs industry. Now Taisho Pharmaceutical Hold Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Taisho Pharmaceutical Hold Ltd in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Major Drugs industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Taisho Pharmaceutical Hold Ltd has opened avenues for new revenue streams for the organization in Major Drugs industry. This can help Taisho Pharmaceutical Hold Ltd to build a more holistic ecosystem for Taisho Pharmaceutical Hold Ltd products in the Major Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Taisho Pharmaceutical Hold Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Major Drugs sector. This continuous investment in analytics has enabled Taisho Pharmaceutical Hold Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Taisho Pharmaceutical Hold Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold 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.
Manufacturing automation
– Taisho Pharmaceutical Hold Ltd can use the latest technology developments to improve its manufacturing and designing process in Major Drugs sector. 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Taisho Pharmaceutical Hold Ltd is facing challenges because of the dominance of functional experts in the organization. Taisho Pharmaceutical Hold Ltd can utilize new technology in the field of Major Drugs industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Taisho Pharmaceutical Hold Ltd 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 Major Drugs industry.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold Ltd to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Taisho Pharmaceutical Hold Ltd can develop new processes and procedures in Major Drugs 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.
Threats Taisho Pharmaceutical Hold Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Taisho Pharmaceutical Hold 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. Taisho Pharmaceutical Hold Ltd needs to understand the core reasons impacting the Major Drugs industry. This will help it in building a better workplace.
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 Taisho Pharmaceutical Hold Ltd.
Environmental challenges
– Taisho Pharmaceutical Hold Ltd 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. Taisho Pharmaceutical Hold Ltd can take advantage of this fund but it will also bring new competitors in the Major Drugs industry.
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 Taisho Pharmaceutical Hold Ltd in the Major Drugs sector and impact the bottomline of the organization.
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.
Easy access to finance
– Easy access to finance in Major Drugs industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Taisho Pharmaceutical Hold Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Major Drugs industry are lowering. It can presents Taisho Pharmaceutical Hold Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Major Drugs sector.
Shortening product life cycle
– it is one of the major threat that Taisho Pharmaceutical Hold Ltd is facing in Major Drugs sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Taisho Pharmaceutical Hold Ltd 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 Major Drugs industry and other sectors.
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 Taisho Pharmaceutical Hold Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Taisho Pharmaceutical Hold Ltd 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 Major Drugs industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold Ltd prominent markets.
Technology acceleration in Forth Industrial Revolution
– Taisho Pharmaceutical Hold Ltd has witnessed rapid integration of technology during Covid-19 in the Major Drugs industry. As one of the leading players in the industry, Taisho Pharmaceutical Hold Ltd needs to keep up with the evolution of technology in the Major Drugs 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.
Weighted SWOT Analysis of Taisho Pharmaceutical Hold Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Taisho Pharmaceutical Hold 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 Taisho Pharmaceutical Hold 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 Taisho Pharmaceutical Hold 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 Taisho Pharmaceutical Hold Ltd 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 Taisho Pharmaceutical Hold Ltd needs to make to build a sustainable competitive advantage.
