Hokkaido Electric Power Co Inc (9509) SWOT Analysis / TOWS Matrix / MBA Resources
Electric Utilities
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Hokkaido Electric Power Co Inc (Japan)
Based on various researches at Oak Spring University , Hokkaido Electric Power Co Inc is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, geopolitical disruptions, talent flight as more people leaving formal jobs, wage bills are increasing, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings,
banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Hokkaido Electric Power Co Inc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hokkaido Electric Power Co Inc can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hokkaido 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 Hokkaido 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 Hokkaido Electric Power Co Inc can be done for the following purposes –
1. Strategic planning of Hokkaido Electric Power Co Inc
2. Improving business portfolio management of Hokkaido 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 Hokkaido Electric Power Co Inc
Strengths of Hokkaido Electric Power Co Inc | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hokkaido Electric Power Co Inc are -
Effective Research and Development (R&D)
– Hokkaido Electric Power Co Inc has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Hokkaido Electric Power Co Inc staying ahead in the Electric Utilities industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Hokkaido 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 Hokkaido Electric Power Co Inc is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hokkaido Electric Power Co Inc emphasize – knowledge, initiative, and innovation.
Digital Transformation in Electric Utilities industry
- digital transformation varies from industry to industry. For Hokkaido Electric Power Co Inc digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hokkaido Electric Power Co Inc has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
High switching costs
– The high switching costs that Hokkaido 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.
High brand equity
– Hokkaido Electric Power Co Inc has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hokkaido Electric Power Co Inc to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Hokkaido Electric Power Co Inc is one of the most innovative firm in Electric Utilities sector.
Strong track record of project management in the Electric Utilities industry
– Hokkaido 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.
Low bargaining power of suppliers
– Suppliers of Hokkaido Electric Power Co Inc in the Utilities sector have low bargaining power. Hokkaido Electric Power Co Inc has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hokkaido Electric Power Co Inc to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Hokkaido Electric Power Co Inc 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.
Operational resilience
– The operational resilience strategy of Hokkaido 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.
Organizational Resilience of Hokkaido Electric Power Co Inc
– The covid-19 pandemic has put organizational resilience at the centre of everthing Hokkaido Electric Power Co Inc does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Hokkaido Electric Power Co Inc has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hokkaido Electric Power Co Inc 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.
Weaknesses of Hokkaido Electric Power Co Inc | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hokkaido Electric Power Co Inc are -
Low market penetration in new markets
– Outside its home market of Japan, Hokkaido Electric Power Co Inc needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, Hokkaido Electric Power Co Inc has high operating costs in the Electric Utilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Hokkaido Electric Power Co Inc lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Hokkaido Electric Power Co Inc is dominated by functional specialists. It is not different from other players in the Electric Utilities industry, but Hokkaido Electric Power Co Inc needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hokkaido Electric Power Co Inc to focus more on services in the Electric Utilities industry rather than just following the product oriented approach.
Skills based hiring in Electric Utilities industry
– The stress on hiring functional specialists at Hokkaido Electric Power Co Inc 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.
High bargaining power of channel partners in Electric Utilities industry
– because of the regulatory requirements in Japan, Hokkaido 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.
High cash cycle compare to competitors
Hokkaido 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.
Need for greater diversity
– Hokkaido Electric Power Co Inc has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Slow to strategic competitive environment developments
– As Hokkaido Electric Power Co Inc is one of the leading players in the Electric Utilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Electric Utilities industry in last five years.
Aligning sales with marketing
– From the outside it seems that Hokkaido 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 Hokkaido Electric Power Co Inc can leverage the sales team experience to cultivate customer relationships as Hokkaido Electric Power Co Inc is planning to shift buying processes online.
High dependence on Hokkaido Electric Power Co Inc ‘s star products
– The top 2 products and services of Hokkaido 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 Hokkaido Electric Power Co Inc has relatively successful track record of launching new products.
No frontier risks strategy
– From the 10K / annual statement of Hokkaido Electric Power Co Inc, it seems that company is thinking out the frontier risks that can impact Electric Utilities 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.
Hokkaido Electric Power Co Inc Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hokkaido Electric Power Co Inc are -
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 Hokkaido Electric Power Co Inc in the Electric Utilities industry. Now Hokkaido Electric Power Co Inc can target international markets with far fewer capital restrictions requirements than the existing system.
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. Hokkaido Electric Power Co Inc can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Hokkaido 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.
Loyalty marketing
– Hokkaido Electric Power Co Inc 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.
Building a culture of innovation
– managers at Hokkaido 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.
Better consumer reach
– The expansion of the 5G network will help Hokkaido Electric Power Co Inc to increase its market reach. Hokkaido 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hokkaido 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.
Developing new processes and practices
– Hokkaido Electric Power Co Inc can develop new processes and procedures in Electric Utilities 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Electric Utilities industry, but it has also influenced the consumer preferences. Hokkaido Electric Power Co Inc can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hokkaido Electric Power Co Inc is facing challenges because of the dominance of functional experts in the organization. Hokkaido Electric Power Co Inc can utilize new technology in the field of Electric Utilities industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Hokkaido Electric Power Co Inc has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Electric Utilities sector. This continuous investment in analytics has enabled Hokkaido Electric Power Co Inc to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hokkaido Electric Power Co Inc to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hokkaido Electric Power Co Inc can use these opportunities to build new business models that can help the communities that Hokkaido Electric Power Co Inc operates in. Secondly it can use opportunities from government spending in Electric Utilities sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hokkaido Electric Power Co Inc 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 Hokkaido Electric Power Co Inc 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 Hokkaido Electric Power Co Inc External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hokkaido Electric Power Co Inc are -
Increasing wage structure of Hokkaido Electric Power Co Inc
– 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 Hokkaido Electric Power Co Inc.
Environmental challenges
– Hokkaido 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. Hokkaido Electric Power Co Inc can take advantage of this fund but it will also bring new competitors in the Electric Utilities industry.
Stagnating economy with rate increase
– Hokkaido Electric Power Co Inc 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 Electric Utilities industry.
Consumer confidence and its impact on Hokkaido 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.
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. Hokkaido Electric Power Co Inc 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.
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. Hokkaido 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.
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 Hokkaido Electric Power Co Inc.
Regulatory challenges
– Hokkaido 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.
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 dependence on third party suppliers
– Hokkaido Electric Power Co Inc 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.
Shortening product life cycle
– it is one of the major threat that Hokkaido 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.
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 Hokkaido Electric Power Co Inc in the Electric Utilities sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Hokkaido 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 Hokkaido 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 Hokkaido 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 Hokkaido 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 Hokkaido 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 Hokkaido Electric Power Co Inc needs to make to build a sustainable competitive advantage.