SWOT Analysis / TOWS Matrix for Alfresa Holdings Corp (Japan)
Based on various researches at Oak Spring University , Alfresa Holdings Corp is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs,
increasing energy prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Alfresa Holdings Corp
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Alfresa Holdings Corp can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Alfresa Holdings Corp, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Alfresa Holdings 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 Alfresa Holdings Corp can be done for the following purposes –
1. Strategic planning of Alfresa Holdings Corp
2. Improving business portfolio management of Alfresa Holdings Corp
3. Assessing feasibility of the new initiative in Japan
4. Making a Biotechnology & Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Alfresa Holdings Corp
Strengths of Alfresa Holdings Corp | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Alfresa Holdings Corp are -
Superior customer experience
– The customer experience strategy of Alfresa Holdings Corp in Biotechnology & Drugs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Biotechnology & Drugs
– Alfresa Holdings Corp is one of the leading players in the Biotechnology & Drugs industry in Japan. Over the years it has not only transformed the business landscape in the Biotechnology & Drugs industry in Japan but also across the existing markets. The ability to lead change has enabled Alfresa Holdings Corp in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Alfresa Holdings Corp
– The covid-19 pandemic has put organizational resilience at the centre of everthing Alfresa Holdings Corp does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Alfresa Holdings Corp is one of the most innovative firm in Biotechnology & Drugs sector.
Successful track record of launching new products
– Alfresa Holdings Corp has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Alfresa Holdings 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.
Ability to recruit top talent
– Alfresa Holdings Corp is one of the leading players in the Biotechnology & Drugs 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.
Operational resilience
– The operational resilience strategy of Alfresa Holdings Corp comprises – understanding the underlying the factors in the Biotechnology & 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.
Sustainable margins compare to other players in Biotechnology & Drugs industry
– Alfresa Holdings Corp has clearly differentiated products in the market place. This has enabled Alfresa Holdings Corp to fetch slight price premium compare to the competitors in the Biotechnology & Drugs industry. The sustainable margins have also helped Alfresa Holdings Corp to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Alfresa Holdings Corp is present in almost all the verticals within the Biotechnology & Drugs industry. This has provided Alfresa Holdings Corp 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.
Digital Transformation in Biotechnology & Drugs industry
- digital transformation varies from industry to industry. For Alfresa Holdings Corp digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Alfresa Holdings 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.
Low bargaining power of suppliers
– Suppliers of Alfresa Holdings Corp in the Healthcare sector have low bargaining power. Alfresa Holdings Corp has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Alfresa Holdings Corp to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Alfresa Holdings 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 Alfresa Holdings Corp | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Alfresa Holdings Corp are -
Workers concerns about automation
– As automation is fast increasing in the Biotechnology & Drugs industry, Alfresa Holdings Corp 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 bargaining power of channel partners in Biotechnology & Drugs industry
– because of the regulatory requirements in Japan, Alfresa Holdings 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 Biotechnology & Drugs industry.
High operating costs
– Compare to the competitors, Alfresa Holdings Corp has high operating costs in the Biotechnology & Drugs industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Alfresa Holdings Corp lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Alfresa Holdings Corp has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Biotechnology & Drugs industry using digital technology.
Lack of clear differentiation of Alfresa Holdings Corp products
– To increase the profitability and margins on the products, Alfresa Holdings Corp needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Alfresa Holdings Corp has a high cash cycle compare to other players in the Biotechnology & Drugs industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– From the outside it seems that Alfresa Holdings Corp needs to have more collaboration between its sales team and marketing team. Sales professionals in the Biotechnology & Drugs industry have deep experience in developing customer relationships. Marketing department at Alfresa Holdings Corp can leverage the sales team experience to cultivate customer relationships as Alfresa Holdings Corp is planning to shift buying processes online.
Products dominated business model
– Even though Alfresa Holdings Corp has some of the most successful models in the Biotechnology & Drugs industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Alfresa Holdings Corp should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– From the 10K / annual statement of Alfresa Holdings Corp, it seems that company is thinking out the frontier risks that can impact Biotechnology & 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.
Increasing silos among functional specialists
– The organizational structure of Alfresa Holdings Corp is dominated by functional specialists. It is not different from other players in the Biotechnology & Drugs industry, but Alfresa Holdings Corp needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Alfresa Holdings Corp to focus more on services in the Biotechnology & Drugs industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Japan, Alfresa Holdings Corp needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Alfresa Holdings Corp Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Alfresa Holdings Corp are -
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. Alfresa Holdings Corp can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Alfresa Holdings Corp 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 Alfresa Holdings Corp to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Alfresa Holdings Corp 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
– Alfresa Holdings Corp can use the latest technology developments to improve its manufacturing and designing process in Biotechnology & 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.
Creating value in data economy
– The success of analytics program of Alfresa Holdings Corp has opened avenues for new revenue streams for the organization in Biotechnology & Drugs industry. This can help Alfresa Holdings Corp to build a more holistic ecosystem for Alfresa Holdings Corp products in the Biotechnology & Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Alfresa Holdings Corp can improve the customer journey of consumers in the Biotechnology & 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Alfresa Holdings Corp can use these opportunities to build new business models that can help the communities that Alfresa Holdings Corp operates in. Secondly it can use opportunities from government spending in Biotechnology & Drugs sector.
Learning at scale
– Online learning technologies has now opened space for Alfresa Holdings Corp 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.
Building a culture of innovation
– managers at Alfresa Holdings 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 Biotechnology & Drugs industry.
Better consumer reach
– The expansion of the 5G network will help Alfresa Holdings Corp to increase its market reach. Alfresa Holdings Corp 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Alfresa Holdings Corp can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Biotechnology & Drugs industry, but it has also influenced the consumer preferences. Alfresa Holdings Corp can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Alfresa Holdings Corp 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 Alfresa Holdings Corp to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Alfresa Holdings Corp External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Alfresa Holdings Corp are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Alfresa Holdings Corp in Biotechnology & Drugs industry. The Biotechnology & Drugs 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Alfresa Holdings 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 Biotechnology & Drugs 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.
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.
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. Alfresa Holdings Corp needs to understand the core reasons impacting the Biotechnology & Drugs industry. This will help it in building a better workplace.
Environmental challenges
– Alfresa Holdings 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. Alfresa Holdings Corp can take advantage of this fund but it will also bring new competitors in the Biotechnology & Drugs industry.
Technology acceleration in Forth Industrial Revolution
– Alfresa Holdings Corp has witnessed rapid integration of technology during Covid-19 in the Biotechnology & Drugs industry. As one of the leading players in the industry, Alfresa Holdings Corp needs to keep up with the evolution of technology in the Biotechnology & 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.
Easy access to finance
– Easy access to finance in Biotechnology & Drugs industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Alfresa Holdings Corp can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Alfresa Holdings Corp is facing in Biotechnology & Drugs sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. Alfresa Holdings 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.
Consumer confidence and its impact on Alfresa Holdings Corp 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 Biotechnology & Drugs industry and other sectors.
Stagnating economy with rate increase
– Alfresa Holdings 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 Biotechnology & Drugs industry.
High dependence on third party suppliers
– Alfresa Holdings Corp 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.
Weighted SWOT Analysis of Alfresa Holdings Corp Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Alfresa Holdings 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 Alfresa Holdings 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 Alfresa Holdings 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 Alfresa Holdings 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 Alfresa Holdings Corp needs to make to build a sustainable competitive advantage.
