SWOT Analysis / TOWS Matrix for Mitsubishi Motors Corp. (Japan)
Based on various researches at Oak Spring University , Mitsubishi Motors Corp. is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, supply chains are disrupted by pandemic , increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, geopolitical disruptions,
central banks are concerned over increasing inflation, wage bills are increasing, etc
Introduction to SWOT Analysis of Mitsubishi Motors Corp.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Mitsubishi Motors Corp. can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mitsubishi Motors Corp., and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mitsubishi Motors Corp. 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 Mitsubishi Motors Corp. can be done for the following purposes –
1. Strategic planning of Mitsubishi Motors Corp.
2. Improving business portfolio management of Mitsubishi Motors Corp.
3. Assessing feasibility of the new initiative in Japan
4. Making a Auto & Truck Manufacturers sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mitsubishi Motors Corp.
Strengths of Mitsubishi Motors Corp. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mitsubishi Motors Corp. are -
Cross disciplinary teams
– Horizontal connected teams at the Mitsubishi Motors Corp. 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.
Training and development
– Mitsubishi Motors Corp. has one of the best training and development program in Consumer Cyclical 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.
Ability to lead change in Auto & Truck Manufacturers
– Mitsubishi Motors Corp. is one of the leading players in the Auto & Truck Manufacturers industry in Japan. Over the years it has not only transformed the business landscape in the Auto & Truck Manufacturers industry in Japan but also across the existing markets. The ability to lead change has enabled Mitsubishi Motors Corp. in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy of Mitsubishi Motors Corp. comprises – understanding the underlying the factors in the Auto & Truck Manufacturers 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.
Learning organization
- Mitsubishi Motors Corp. 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 Mitsubishi Motors Corp. is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Mitsubishi Motors Corp. emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Mitsubishi Motors Corp. in the Consumer Cyclical sector have low bargaining power. Mitsubishi Motors Corp. has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mitsubishi Motors Corp. to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Auto & Truck Manufacturers industry
– Mitsubishi Motors Corp. has clearly differentiated products in the market place. This has enabled Mitsubishi Motors Corp. to fetch slight price premium compare to the competitors in the Auto & Truck Manufacturers industry. The sustainable margins have also helped Mitsubishi Motors Corp. to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Mitsubishi Motors Corp. has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Auto & Truck Manufacturers industry. Secondly the value chain collaborators of Mitsubishi Motors Corp. have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Mitsubishi Motors Corp. is one of the leading players in the Auto & Truck Manufacturers industry in Japan. It is in a position to attract the best talent available in Japan. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Mitsubishi Motors Corp. has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mitsubishi Motors Corp. 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.
Digital Transformation in Auto & Truck Manufacturers industry
- digital transformation varies from industry to industry. For Mitsubishi Motors Corp. digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mitsubishi Motors Corp. 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.
High switching costs
– The high switching costs that Mitsubishi Motors Corp. has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses of Mitsubishi Motors Corp. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mitsubishi Motors Corp. are -
High cash cycle compare to competitors
Mitsubishi Motors Corp. has a high cash cycle compare to other players in the Auto & Truck Manufacturers industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of Japan, Mitsubishi Motors Corp. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring in Auto & Truck Manufacturers industry
– The stress on hiring functional specialists at Mitsubishi Motors Corp. 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mitsubishi Motors Corp. is slow explore the new channels of communication. These new channels of communication can help Mitsubishi Motors Corp. to provide better information regarding Auto & Truck Manufacturers products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Mitsubishi Motors Corp. has some of the most successful models in the Auto & Truck Manufacturers industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Mitsubishi Motors Corp. should strive to include more intangible value offerings along with its core products and services.
Employees’ less understanding of Mitsubishi Motors Corp. strategy
– From the outside it seems that the employees of Mitsubishi Motors Corp. 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.
Lack of clear differentiation of Mitsubishi Motors Corp. products
– To increase the profitability and margins on the products, Mitsubishi Motors Corp. needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners in Auto & Truck Manufacturers industry
– because of the regulatory requirements in Japan, Mitsubishi Motors Corp. 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 Auto & Truck Manufacturers industry.
High dependence on Mitsubishi Motors Corp. ‘s star products
– The top 2 products and services of Mitsubishi Motors Corp. still accounts for major business revenue. This dependence on star products in Auto & Truck Manufacturers industry has resulted into insufficient focus on developing new products, even though Mitsubishi Motors Corp. has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee of Mitsubishi Motors Corp. is just above the Auto & Truck Manufacturers 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.
Need for greater diversity
– Mitsubishi Motors Corp. 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.
Mitsubishi Motors Corp. Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Mitsubishi Motors Corp. are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mitsubishi Motors Corp. can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Mitsubishi Motors Corp. 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 Auto & Truck Manufacturers industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mitsubishi Motors Corp. can use these opportunities to build new business models that can help the communities that Mitsubishi Motors Corp. operates in. Secondly it can use opportunities from government spending in Auto & Truck Manufacturers sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mitsubishi Motors Corp. in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Auto & Truck Manufacturers industry, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Auto & Truck Manufacturers industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mitsubishi Motors Corp. 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. Mitsubishi Motors Corp. 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.
Manufacturing automation
– Mitsubishi Motors Corp. can use the latest technology developments to improve its manufacturing and designing process in Auto & Truck Manufacturers 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.
Leveraging digital technologies
– Mitsubishi Motors Corp. 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.
Use of Bitcoin and other crypto currencies for transactions in Auto & Truck Manufacturers industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Mitsubishi Motors Corp. in the Auto & Truck Manufacturers industry. Now Mitsubishi Motors Corp. can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Mitsubishi Motors Corp. is facing challenges because of the dominance of functional experts in the organization. Mitsubishi Motors Corp. can utilize new technology in the field of Auto & Truck Manufacturers industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– Mitsubishi Motors Corp. can improve the customer journey of consumers in the Auto & Truck Manufacturers 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Auto & Truck Manufacturers industry, but it has also influenced the consumer preferences. Mitsubishi Motors Corp. can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Mitsubishi Motors Corp. 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.
Developing new processes and practices
– Mitsubishi Motors Corp. can develop new processes and procedures in Auto & Truck Manufacturers 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 Mitsubishi Motors Corp. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Mitsubishi Motors Corp. are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Auto & Truck Manufacturers industry are lowering. It can presents Mitsubishi Motors Corp. with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Auto & Truck Manufacturers sector.
Environmental challenges
– Mitsubishi Motors Corp. 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. Mitsubishi Motors Corp. can take advantage of this fund but it will also bring new competitors in the Auto & Truck Manufacturers industry.
Regulatory challenges
– Mitsubishi Motors Corp. 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 Auto & Truck Manufacturers industry regulations.
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. Mitsubishi Motors Corp. needs to understand the core reasons impacting the Auto & Truck Manufacturers industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Mitsubishi Motors Corp. 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 Auto & Truck Manufacturers industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Mitsubishi Motors Corp. may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Auto & Truck Manufacturers sector.
Technology acceleration in Forth Industrial Revolution
– Mitsubishi Motors Corp. has witnessed rapid integration of technology during Covid-19 in the Auto & Truck Manufacturers industry. As one of the leading players in the industry, Mitsubishi Motors Corp. needs to keep up with the evolution of technology in the Auto & Truck Manufacturers 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.
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. Mitsubishi Motors Corp. 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mitsubishi Motors Corp. in Auto & Truck Manufacturers industry. The Auto & Truck Manufacturers 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.
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 Mitsubishi Motors Corp. in the Auto & Truck Manufacturers sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Mitsubishi Motors Corp. is facing in Auto & Truck Manufacturers sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Mitsubishi Motors Corp.
– 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 Mitsubishi Motors Corp..
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 Mitsubishi Motors Corp. business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Mitsubishi Motors Corp. Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Mitsubishi Motors Corp. 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 Mitsubishi Motors Corp. 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 Mitsubishi Motors Corp. 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 Mitsubishi Motors Corp. 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 Mitsubishi Motors Corp. needs to make to build a sustainable competitive advantage.