Tohoku Electric Power Co Inc (9506) SWOT Analysis / TOWS Matrix / MBA Resources
Electric Utilities
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Tohoku Electric Power Co Inc (Japan)
Based on various researches at Oak Spring University , Tohoku Electric Power Co Inc is operating in a macro-environment that has been destablized by – increasing commodity prices, increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation,
technology disruption, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Tohoku Electric Power Co Inc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tohoku Electric Power Co Inc can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tohoku Electric Power Co Inc, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc can be done for the following purposes –
1. Strategic planning of Tohoku Electric Power Co Inc
2. Improving business portfolio management of Tohoku Electric Power Co Inc
3. Assessing feasibility of the new initiative in Japan
4. Making a Electric Utilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tohoku Electric Power Co Inc
Strengths of Tohoku Electric Power Co Inc | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tohoku Electric Power Co Inc are -
Innovation driven organization
– Tohoku Electric Power Co Inc is one of the most innovative firm in Electric Utilities sector.
Operational resilience
– The operational resilience strategy of Tohoku Electric Power Co Inc comprises – understanding the underlying the factors in the Electric Utilities 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.
Superior customer experience
– The customer experience strategy of Tohoku Electric Power Co Inc in Electric Utilities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Tohoku Electric Power Co Inc 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.
Learning organization
- Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tohoku Electric Power Co Inc emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Tohoku Electric Power Co Inc
– The covid-19 pandemic has put organizational resilience at the centre of everthing Tohoku Electric Power Co Inc does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Electric Utilities industry
– Tohoku Electric Power Co Inc has clearly differentiated products in the market place. This has enabled Tohoku Electric Power Co Inc to fetch slight price premium compare to the competitors in the Electric Utilities industry. The sustainable margins have also helped Tohoku Electric Power Co Inc to invest into research and development (R&D) and innovation.
Strong track record of project management in the Electric Utilities industry
– Tohoku Electric Power Co Inc is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Tohoku Electric Power Co Inc 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 Electric Utilities 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.
Low bargaining power of suppliers
– Suppliers of Tohoku Electric Power Co Inc in the Utilities sector have low bargaining power. Tohoku Electric Power Co Inc has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tohoku Electric Power Co Inc to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Tohoku Electric Power Co Inc has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Electric Utilities industry. Secondly the value chain collaborators of Tohoku Electric Power Co Inc have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Tohoku Electric Power Co Inc is one of the leading players in the Electric Utilities 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.
Weaknesses of Tohoku Electric Power Co Inc | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Tohoku Electric Power Co Inc are -
High cash cycle compare to competitors
Tohoku Electric Power Co Inc has a high cash cycle compare to other players in the Electric Utilities industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tohoku Electric Power Co Inc is slow explore the new channels of communication. These new channels of communication can help Tohoku Electric Power Co Inc to provide better information regarding Electric Utilities products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Electric Utilities industry
– because of the regulatory requirements in Japan, Tohoku Electric Power Co Inc 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 Electric Utilities industry.
Workers concerns about automation
– As automation is fast increasing in the Electric Utilities industry, Tohoku Electric Power Co Inc 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.
High dependence on Tohoku Electric Power Co Inc ‘s star products
– The top 2 products and services of Tohoku Electric Power Co Inc still accounts for major business revenue. This dependence on star products in Electric Utilities industry has resulted into insufficient focus on developing new products, even though Tohoku Electric Power Co Inc has relatively successful track record of launching new products.
Products dominated business model
– Even though Tohoku Electric Power Co Inc has some of the most successful models in the Electric Utilities industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Tohoku Electric Power Co Inc should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Tohoku Electric Power Co Inc needs to have more collaboration between its sales team and marketing team. Sales professionals in the Electric Utilities industry have deep experience in developing customer relationships. Marketing department at Tohoku Electric Power Co Inc can leverage the sales team experience to cultivate customer relationships as Tohoku Electric Power Co Inc is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Tohoku Electric Power Co Inc, in the dynamic environment of Electric Utilities industry it has struggled to respond to the nimble upstart competition. Tohoku Electric Power Co Inc 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 Japan, Tohoku Electric Power Co Inc needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Tohoku Electric Power Co Inc supply chain. Even after few cautionary changes, Tohoku Electric Power Co Inc is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tohoku Electric Power Co Inc vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Tohoku Electric Power Co Inc has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Electric Utilities industry over the last five years. Tohoku Electric Power Co Inc 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.
Tohoku Electric Power Co Inc Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Tohoku Electric Power Co Inc are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tohoku Electric Power Co Inc can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Tohoku Electric Power Co Inc 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.
Manufacturing automation
– Tohoku Electric Power Co Inc can use the latest technology developments to improve its manufacturing and designing process in Electric Utilities 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Electric Utilities industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Tohoku Electric Power Co Inc 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. Tohoku Electric Power Co Inc 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.
Use of Bitcoin and other crypto currencies for transactions in Electric Utilities industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Tohoku Electric Power Co Inc in the Electric Utilities industry. Now Tohoku Electric Power Co Inc can target international markets with far fewer capital restrictions requirements than the existing system.
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 Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc to increase its market reach. Tohoku Electric Power Co Inc 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tohoku Electric Power Co Inc can use these opportunities to build new business models that can help the communities that Tohoku Electric Power Co Inc operates in. Secondly it can use opportunities from government spending in Electric Utilities sector.
Building a culture of innovation
– managers at Tohoku Electric Power Co Inc 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 Electric Utilities industry.
Learning at scale
– Online learning technologies has now opened space for Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc has opened avenues for new revenue streams for the organization in Electric Utilities industry. This can help Tohoku Electric Power Co Inc to build a more holistic ecosystem for Tohoku Electric Power Co Inc products in the Electric Utilities industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tohoku Electric Power Co Inc in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Electric Utilities industry, and it will provide faster access to the consumers.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Tohoku Electric Power Co Inc can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Tohoku Electric Power Co Inc External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Tohoku Electric Power Co Inc are -
Easy access to finance
– Easy access to finance in Electric Utilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Tohoku Electric Power Co Inc can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc prominent markets.
Regulatory challenges
– Tohoku Electric Power Co Inc 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 Electric Utilities industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Tohoku Electric Power Co Inc may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electric Utilities sector.
Shortening product life cycle
– it is one of the major threat that Tohoku Electric Power Co Inc is facing in Electric Utilities sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Tohoku Electric Power Co Inc in Electric Utilities industry. The Electric Utilities 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.
Consumer confidence and its impact on Tohoku Electric Power Co Inc 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 Electric Utilities 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 Tohoku Electric Power Co Inc.
Environmental challenges
– Tohoku Electric Power Co Inc 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. Tohoku Electric Power Co Inc can take advantage of this fund but it will also bring new competitors in the Electric Utilities industry.
Technology acceleration in Forth Industrial Revolution
– Tohoku Electric Power Co Inc has witnessed rapid integration of technology during Covid-19 in the Electric Utilities industry. As one of the leading players in the industry, Tohoku Electric Power Co Inc needs to keep up with the evolution of technology in the Electric Utilities 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.
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.
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 Tohoku Electric Power Co Inc business can come under increasing regulations regarding data privacy, data security, etc.
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. Tohoku Electric Power Co Inc needs to understand the core reasons impacting the Electric Utilities industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Tohoku Electric Power Co Inc Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc 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 Tohoku Electric Power Co Inc needs to make to build a sustainable competitive advantage.