Ariake Japan Co Ltd (2815) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Ariake Japan Co Ltd (Japan)
Based on various researches at Oak Spring University , Ariake Japan Co Ltd is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, wage bills are increasing, challanges to central banks by blockchain based private currencies, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models,
supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Ariake Japan Co Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Ariake Japan Co Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ariake Japan Co Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ariake Japan Co Ltd operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Ariake Japan Co Ltd can be done for the following purposes –
1. Strategic planning of Ariake Japan Co Ltd
2. Improving business portfolio management of Ariake Japan Co Ltd
3. Assessing feasibility of the new initiative in Japan
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ariake Japan Co Ltd
Strengths of Ariake Japan Co Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ariake Japan Co Ltd are -
High brand equity
– Ariake Japan Co Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ariake Japan Co Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Ariake Japan Co Ltd are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Low bargaining power of suppliers
– Suppliers of Ariake Japan Co Ltd in the Consumer/Non-Cyclical sector have low bargaining power. Ariake Japan Co Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ariake Japan Co Ltd to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Ariake Japan Co Ltd 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.
Sustainable margins compare to other players in Food Processing industry
– Ariake Japan Co Ltd has clearly differentiated products in the market place. This has enabled Ariake Japan Co Ltd to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped Ariake Japan Co Ltd to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Ariake Japan Co Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Ariake Japan Co Ltd staying ahead in the Food Processing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of Ariake Japan Co Ltd comprises – understanding the underlying the factors in the Food Processing 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.
Innovation driven organization
– Ariake Japan Co Ltd is one of the most innovative firm in Food Processing sector.
Superior customer experience
– The customer experience strategy of Ariake Japan Co Ltd in Food Processing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Food Processing industry
- digital transformation varies from industry to industry. For Ariake Japan Co Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ariake Japan Co Ltd has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Diverse revenue streams
– Ariake Japan Co Ltd is present in almost all the verticals within the Food Processing industry. This has provided Ariake Japan Co Ltd a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Strong track record of project management in the Food Processing industry
– Ariake Japan Co Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Ariake Japan Co Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ariake Japan Co Ltd are -
Capital Spending Reduction
– Even during the low interest decade, Ariake Japan Co Ltd 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 Food Processing industry using digital technology.
Skills based hiring in Food Processing industry
– The stress on hiring functional specialists at Ariake Japan Co Ltd 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 strategic competitive environment developments
– As Ariake Japan Co Ltd is one of the leading players in the Food Processing industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Food Processing industry in last five years.
No frontier risks strategy
– From the 10K / annual statement of Ariake Japan Co Ltd, it seems that company is thinking out the frontier risks that can impact Food Processing 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.
Products dominated business model
– Even though Ariake Japan Co Ltd has some of the most successful models in the Food Processing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Ariake Japan Co Ltd should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners in Food Processing industry
– because of the regulatory requirements in Japan, Ariake Japan Co Ltd is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Food Processing industry.
Workers concerns about automation
– As automation is fast increasing in the Food Processing industry, Ariake Japan Co Ltd 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 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 Ariake Japan Co Ltd supply chain. Even after few cautionary changes, Ariake Japan Co Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ariake Japan Co Ltd vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of Ariake Japan Co Ltd strategy
– From the outside it seems that the employees of Ariake Japan Co Ltd 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.
Slow decision making process
– As mentioned earlier in the report, Ariake Japan Co Ltd has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Food Processing industry over the last five years. Ariake Japan Co Ltd even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Interest costs
– Compare to the competition, Ariake Japan Co Ltd has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ariake Japan Co Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Ariake Japan Co Ltd are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. Ariake Japan Co Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ariake Japan Co Ltd in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Ariake Japan Co Ltd can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Food Processing industry.
Leveraging digital technologies
– Ariake Japan Co Ltd 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.
Learning at scale
– Online learning technologies has now opened space for Ariake Japan Co Ltd 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.
Use of Bitcoin and other crypto currencies for transactions in Food Processing industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Ariake Japan Co Ltd in the Food Processing industry. Now Ariake Japan Co Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ariake Japan Co Ltd 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.
Manufacturing automation
– Ariake Japan Co Ltd can use the latest technology developments to improve its manufacturing and designing process in Food Processing 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.
Better consumer reach
– The expansion of the 5G network will help Ariake Japan Co Ltd to increase its market reach. Ariake Japan Co Ltd 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.
Creating value in data economy
– The success of analytics program of Ariake Japan Co Ltd has opened avenues for new revenue streams for the organization in Food Processing industry. This can help Ariake Japan Co Ltd to build a more holistic ecosystem for Ariake Japan Co Ltd products in the Food Processing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Ariake Japan Co Ltd can improve the customer journey of consumers in the Food Processing 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.
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. Ariake Japan Co Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ariake Japan Co Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Ariake Japan Co Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Ariake Japan Co Ltd are -
Environmental challenges
– Ariake Japan Co Ltd needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Ariake Japan Co Ltd can take advantage of this fund but it will also bring new competitors in the Food Processing industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Ariake Japan Co Ltd may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing sector.
High dependence on third party suppliers
– Ariake Japan Co Ltd 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.
Technology acceleration in Forth Industrial Revolution
– Ariake Japan Co Ltd has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, Ariake Japan Co Ltd needs to keep up with the evolution of technology in the Food Processing 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.
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. Ariake Japan Co Ltd needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
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. Ariake Japan Co Ltd 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.
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 Ariake Japan Co Ltd in the Food Processing sector and impact the bottomline 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.
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.
Consumer confidence and its impact on Ariake Japan Co Ltd demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Food Processing industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Food Processing industry are lowering. It can presents Ariake Japan Co Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Food Processing sector.
Stagnating economy with rate increase
– Ariake Japan Co Ltd can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Food Processing industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ariake Japan Co Ltd can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate Ariake Japan Co Ltd prominent markets.
Weighted SWOT Analysis of Ariake Japan Co Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Ariake Japan Co Ltd needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Ariake Japan Co Ltd is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Ariake Japan Co Ltd is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Ariake Japan Co Ltd to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Ariake Japan Co Ltd needs to make to build a sustainable competitive advantage.