Nihon Kohden Corp (6849) SWOT Analysis / TOWS Matrix / MBA Resources
Medical Equipment & Supplies
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Nihon Kohden Corp (Japan)
Based on various researches at Oak Spring University , Nihon Kohden Corp is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, increasing commodity prices, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google,
customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, etc
Introduction to SWOT Analysis of Nihon Kohden Corp
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Nihon Kohden Corp can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nihon Kohden Corp, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nihon Kohden 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 Nihon Kohden Corp can be done for the following purposes –
1. Strategic planning of Nihon Kohden Corp
2. Improving business portfolio management of Nihon Kohden Corp
3. Assessing feasibility of the new initiative in Japan
4. Making a Medical Equipment & Supplies sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Nihon Kohden Corp
Strengths of Nihon Kohden Corp | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nihon Kohden Corp are -
Low bargaining power of suppliers
– Suppliers of Nihon Kohden Corp in the Healthcare sector have low bargaining power. Nihon Kohden Corp has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nihon Kohden Corp to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Nihon Kohden Corp
– The covid-19 pandemic has put organizational resilience at the centre of everthing Nihon Kohden Corp 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 Nihon Kohden Corp comprises – understanding the underlying the factors in the Medical Equipment & Supplies 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.
Analytics focus
– Nihon Kohden Corp 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 Medical Equipment & Supplies 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.
Cross disciplinary teams
– Horizontal connected teams at the Nihon Kohden 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.
Innovation driven organization
– Nihon Kohden Corp is one of the most innovative firm in Medical Equipment & Supplies sector.
High brand equity
– Nihon Kohden Corp has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nihon Kohden Corp to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Nihon Kohden Corp has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Nihon Kohden Corp staying ahead in the Medical Equipment & Supplies industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Nihon Kohden Corp is one of the leading players in the Medical Equipment & Supplies 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.
Training and development
– Nihon Kohden Corp 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.
Sustainable margins compare to other players in Medical Equipment & Supplies industry
– Nihon Kohden Corp has clearly differentiated products in the market place. This has enabled Nihon Kohden Corp to fetch slight price premium compare to the competitors in the Medical Equipment & Supplies industry. The sustainable margins have also helped Nihon Kohden Corp to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Nihon Kohden Corp has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Medical Equipment & Supplies industry. Secondly the value chain collaborators of Nihon Kohden Corp have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Nihon Kohden Corp | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nihon Kohden Corp are -
Aligning sales with marketing
– From the outside it seems that Nihon Kohden Corp needs to have more collaboration between its sales team and marketing team. Sales professionals in the Medical Equipment & Supplies industry have deep experience in developing customer relationships. Marketing department at Nihon Kohden Corp can leverage the sales team experience to cultivate customer relationships as Nihon Kohden Corp is planning to shift buying processes online.
High dependence on Nihon Kohden Corp ‘s star products
– The top 2 products and services of Nihon Kohden Corp still accounts for major business revenue. This dependence on star products in Medical Equipment & Supplies industry has resulted into insufficient focus on developing new products, even though Nihon Kohden Corp has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nihon Kohden Corp is slow explore the new channels of communication. These new channels of communication can help Nihon Kohden Corp to provide better information regarding Medical Equipment & Supplies products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Nihon Kohden Corp products
– To increase the profitability and margins on the products, Nihon Kohden Corp needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Nihon Kohden 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 Medical Equipment & Supplies industry using digital technology.
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 Nihon Kohden Corp supply chain. Even after few cautionary changes, Nihon Kohden Corp is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nihon Kohden Corp vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Nihon Kohden Corp has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Medical Equipment & Supplies industry over the last five years. Nihon Kohden Corp 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.
High cash cycle compare to competitors
Nihon Kohden Corp has a high cash cycle compare to other players in the Medical Equipment & Supplies industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative at Nihon Kohden Corp, in the dynamic environment of Medical Equipment & Supplies industry it has struggled to respond to the nimble upstart competition. Nihon Kohden Corp has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, Nihon Kohden Corp has high operating costs in the Medical Equipment & Supplies industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Nihon Kohden Corp lucrative customers.
Employees’ less understanding of Nihon Kohden Corp strategy
– From the outside it seems that the employees of Nihon Kohden 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.
Nihon Kohden Corp Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Nihon Kohden Corp are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Medical Equipment & Supplies industry, but it has also influenced the consumer preferences. Nihon Kohden 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, Nihon Kohden 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 Nihon Kohden 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.
Learning at scale
– Online learning technologies has now opened space for Nihon Kohden 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 Nihon Kohden 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 Medical Equipment & Supplies industry.
Use of Bitcoin and other crypto currencies for transactions in Medical Equipment & Supplies industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Nihon Kohden Corp in the Medical Equipment & Supplies industry. Now Nihon Kohden Corp can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Nihon Kohden 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 Nihon Kohden Corp to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Nihon Kohden 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.
Creating value in data economy
– The success of analytics program of Nihon Kohden Corp has opened avenues for new revenue streams for the organization in Medical Equipment & Supplies industry. This can help Nihon Kohden Corp to build a more holistic ecosystem for Nihon Kohden Corp products in the Medical Equipment & Supplies industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Nihon Kohden Corp can use the latest technology developments to improve its manufacturing and designing process in Medical Equipment & Supplies 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.
Developing new processes and practices
– Nihon Kohden Corp can develop new processes and procedures in Medical Equipment & Supplies 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nihon Kohden Corp can use these opportunities to build new business models that can help the communities that Nihon Kohden Corp operates in. Secondly it can use opportunities from government spending in Medical Equipment & Supplies sector.
Loyalty marketing
– Nihon Kohden Corp 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.
Better consumer reach
– The expansion of the 5G network will help Nihon Kohden Corp to increase its market reach. Nihon Kohden 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.
Threats Nihon Kohden Corp External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Nihon Kohden Corp are -
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.
Increasing wage structure of Nihon Kohden 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 Nihon Kohden Corp.
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.
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 Nihon Kohden Corp in the Medical Equipment & Supplies sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Nihon Kohden 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 Medical Equipment & Supplies industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Nihon Kohden Corp business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Medical Equipment & Supplies industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Nihon Kohden 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 Nihon Kohden Corp is facing in Medical Equipment & Supplies sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Nihon Kohden Corp.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Nihon Kohden 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 Medical Equipment & Supplies sector.
Regulatory challenges
– Nihon Kohden 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 Medical Equipment & Supplies industry regulations.
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. Nihon Kohden 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nihon Kohden Corp 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 Nihon Kohden Corp prominent markets.
Weighted SWOT Analysis of Nihon Kohden Corp Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Nihon Kohden 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 Nihon Kohden 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 Nihon Kohden 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 Nihon Kohden 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 Nihon Kohden Corp needs to make to build a sustainable competitive advantage.